38.2% retracement also near the 100 hour MA
The USDJPY moved above a swing area at 106.35 to 106.44. Those levels were swing lows for April. They were broken to the downside yesterday on the way to a low at 105.978 (call it 106.00). Today, the low was just above that level and the price has trended higher.
The move higher was able to extend above the April lows and also above its 100 hour moving average currently at 106.533 and the 38.2% retracement of the move down from the April 30 high at 106.556. That should've lead to further upside momentum with a test of the 50% and the 200 hour moving average. Instead the price break failed.
The question now is can the price stay below the 100 hour moving average and 38.2% retracement. If so the pair is remain in control. If broken again, I would expect further upside probing with that 200 hour moving average and 50% retracement in the 106.70 – 73 area as targets.
On the downside there is still work to be done. The lows from April down to 106.354 (and up to 106.44) still need to be broken (along with the underside of the broken trend line near the low area). If done, that opens the door for further momentum to the downside with the key target at 106.00.
Sellers are trying to control, stay below the 100 hour/38.2% retracement and they keep it.
