Can the broken trend line hold.
The USDJPY has had a down and up session today. The run lower earlier in the session, stalled ahead of the low from Friday, moved back above a broken trend line (see green circles), a topside trend line at 106.05 currently (see red circles), and the 100 hour MA (blue line) at 106.19. All that is bullish.
The pair did stall near the 200 hour MA at 106.293 and the price has moved back below the 100 hour MA on the move back down.. Sellers stalling the run higher.
Technically, the 106.05 broken trend line will now be eyed as a key “line in the sand” for the bulls/bears.
A move back below that broken trend line, and the ups and downs continues with the sellers having the upper hand.. The 200 hour MA and 100 hour MA would be the ceiling again. The sellers against those levels will feel more confident that they sold highs.
Stay above the broken trend line, and the sellers from above may get a little more worried. A break above the 200 hour MA should solicit more buying.
The stocks in the US are expected to open lower with Facebook a catalyst for tech stocks at least (FB is down -4% on data concerns again).
The JPY has not had that flight to safety bid (lower USDJPY) today despite the stock declines (European stocks are down too). Does that dynamic keep a lid on rallies?
You can argue that idea, but so far, it has not stopped the pair from rallying off the lows. It has, however stalled at key resistance. So listen to the price action as the market – and traders – sort out the next move.