Forex: USDJPY Technical Analysis Update – 80.00 Support Holds – Range Resistance Fragile
- The dollar/yen currency pair has found support today around the 80.00 handle, which is closely aligned with the 50% retrace of the last swing to the upside. See the daily timeframe (figure 1) USDJPY chart below.
- This comes after a breakout of the inside day (which formed on Monday) to the downside, and is yet another example of a psychological major round number level providing a form of support or resistance.
- The U.S. currency has subsequently risen 0.2%, to the 80.44 USDJPY level, after finding support at 79.95 and seeing a resumption of the dominant mid-term trend.
- We can see on the longer term chart (figure 2) that a 50% retrace of the last major swing lower marks a significant resistance point for the USDJPY. This area gave resistance on three attempts to move to the upside in April and May.
- With this in mind we see the 80.00 handle and 80.66 (the post NFP high) as the near term range support and resistance levels respectively. Any break of these areas could help determine the near term directional bias for this pair.
- We also note that the US Dollar Index (USDX), which tracks the U.S. currency versus six major trading partners, has dropped 0.2 percent to 80.59 after four consecutive up days. US Treasury 10-year notes halted a two-day rise as yields (inverse to price) were up four basis points at 1.73%.
USDJPY Daily (Figure 2)
Related terms: Forex technical analysis, USDJPY, dollar yen forecast.