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USDJPY trades back toward week's high

Started by forex4you, May 20, 2023, 06:14 am

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USDJPY trades back toward week's high

The USDJPY is reversing back to the upside helped by higher rates. The 2-year yield is up 7.1 basis points to 4.34%. The 10-year is up 6.7 basis points 3.714%.

Technically, the price is also being supported by the inability to move back below the old swing highs from 2023. Recall that in March, the high price reached 137.91. In early May, the high price reached 137.761. Yesterday the price extended above those highs and stayed above. Today's corrective move came down to a low of 137.959 - about 4 pips from the old March high. Buyers lined up against the support level and pushed the pair back to the upside.  Corrective test successful. The success increases the old swing high's importance from a technical perspective. 

Also of importance technically, was that earlier this week, the price extended back above its 200-day moving average currently at 137.123.  Being above that level is also a key technical clue that gives the buyers more control.

Going forward, if the price were to move below 137.76 from early May, the 200-day moving average would be the next key support target that would need to be re-broken to give the sellers more comfort. Absent that, the buyers are still in more control.

Taking a broader look at the daily chart, the next key upside target comes against the 50% midpoint of the move down from the 2022 high, to the 2023 low. That retracement level comes in at 139.574.  The price is currently about 100 pips short of that level.



                This article was written by Greg Michalowski at www.forexlive.com.

Source: USDJPY trades back toward week's high

forexlive.com
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