Stall on the test of the 200 day MA
The USDJPY had stalled yesterday and earlier today against the 38.2% of the move down from the December 26 high at 108.495. However, when the price moved above that level over the last hour or so, sellers gave up and pushed the price up about 13 pips to the 200 day moving average at 108.622. That was the next target and sellers have leaned on the first test.
Recall that in trading yesterday the price initially tried to stall against the 100 day moving average (lower blue line currently at 108.187), but ultimately broke above and the price ran higher.
Between the 100 day moving average below and the 200 day moving average above, sits the 100 hour moving average (currently at 108.357). The price action yesterday afternoon and again today, saw moves above and below that moving average level (the market was unsure of the next move). However, the dips below could not retest the 100 day moving average. As a result, the buyers kept a little more control - at least in the shorter-term. The price ultimately broke higher.
What now?
The close levels to monitor are the 38.2% retracement on the downside, and the 200 day moving average above.
Stay above the 38.2% retracement and there should be a retest and potential break of the 200 day moving average. The next upside targets on a break would be the 50% retracement at 108.72 followed by the 200 hour moving average at 108.814 currently (top green line in the chart above).
Move back below the 38.2% level (floor now), and I would be not be surprised to see the buyers turn to sellers (and once again taking control), with a move below the 100 hour moving average at 108.357 taken a little more seriously. The 100 day MA would be the next downside target at 108.187.
