- USD/JPY retreats from 11-week-old previous support, snaps four-day downtrend.
- Convergence of 100-DMA, 50% Fibonacci retracement level challenge bears.
- Golden ratio appears the key for bearish confirmation, monthly resistance line adds to the upside filters.
USD/JPY takes offers to refresh intraday low near 141.70 heading into Tuesday’s European session.
In doing so, the Yen pair reverses from the previous support line stretched from early September, around 142.25 by the press time, amid bearish MACD signals.
The pullback moves, however, appear shallow as a confluence of the 100-Day Moving Average (DMA) and the 50% Fibonacci retracement level of the pair’s August-October upside, near the 141.00 round figure, challenge the USD/JPY bears.
Even if the Yen pair sellers dominate past 141.00, the 140.00 threshold and the 61.8% Fibonacci retracement level surrounding 138.60, also known as the Golden Ratio, could restrict the quote’s further downside.
Following that, the early August high near 135.50 could regain the market’s attention.
On the contrary, an upside break of the support-turned-resistance line near 142.25 won’t be an open invitation to the USD/JPY bears as a downwards-sloping resistance line from late October, close to 143.45, could challenge the upside momentum.
In a case where USD/JPY remains firmer past 143.45, multiple hurdles around 145.10 appear the last defense of the pair sellers.
To sum up, USD/JPY retreats from short-term key hurdle but the overall view remains bullish.
USD/JPY: Daily chart
Trend: Limited downside expected
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