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- USD/JPY Technical Strategy: Flat
- Support: 101.32, 101.12, 100.92
- Resistance: 101.52, 101.91, 102.25
The Japanese Yen fell for a third straight day against the US Dollar after the latter currency reclaimed a foothold above key support-turned-resistance at 101.32. A daily close above falling trend line resistance at 101.52 exposes the top of a downward-sloping channel set from early June, now at 101.91. Alternatively, a reversal back below 101.32 clears the way for a test of the 38.2% Fibonacci expansion at 101.12.
Risk/reward considerations argue against entering long with prices trading in close proximity to resistance. On the other hand, the absence of a defined bearish reversal signal suggests taking up the short side is premature. We will remain flat for now.
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Daily Chart – Created Using FXCM Marketscope 2.0
— Written by Ilya Spivak, Currency Strategist for DailyFX.com