The “market” is looking for the next boost
The USDJPY rose to test the 50% retracement of the drop from the March 25 high in yesterday’s trading. This level reaches 109.309. Yesterday’s high price extended above this level to 109.37, but the movement was short-lived. The price has started to correct. This 50% retracement level remains a key upward target. Know.
The price rallied at the Asian opening today, but the highest is again below the 50% level, the price has fallen again.
Looking at the price action over the past 2 days, the movements are up and down. The market is looking for the next push at some point.
On the lower and lower movements in the past two days, the price has moved above and below its 100-day moving average (blue overlay line). This moving average is currently 108.946. That’s about where we are trading right now.
Today’s low fell below a channel trend line (bullish flag?), But only briefly. This lower trend line is currently at 108.64. Keep this level in mind on weakness. If it holds, buyers stay in control (and the hope of a break and a higher run remains at stake).
On top, the trend line of the upper channel is currently located at 109.16 (and moves lower). A break above the dynamics should trigger a new retracement test of 50% at 109.309. Going above this level – and staying above this level – would be a more bullish game and we should see further upward momentum towards 109.657, then the 61.8% retracement of the drop from the top March 24 at 109.875.
For now, however, the pair is mired in a trading range from top to bottom with the 100-day MA between the extremes, traders awaiting the next push.