Can the momentum continue?
The USDJPY is trading to new session highs ahead of the US stock opening at the bottom of the hour.
The futures are implying a higher opening with the Dow implying a gain of 178. The index was up over 200 points at one point this morning. So the gains are a bit lower. Nevertheless, it should be a good start. US yields are also higher with the 10 year now at 2.4336%, up 3.53 bps, but that is off the highs at 2.4513%. From the data front, the housing data was not all that great today with Housing starts and building permits lower along with the S&P/Case Schiller data. Nevertheless, the price of the USDJPY is still near the highs of the day.
Technically for the pair, the price action has seen gains through a trend line, and then a floor/ceiling (see yellow area in the chart). More recently, the price moved above a downward moving 100 hour MA at 110.416. Can that 100 hour MA break hold support now?
The range for the day is up to 63 pips. That is around the average over the last 22 trading days of 61 pips.
Buyers are making the play, but the pair is at a crossroad. Does the steday trend higher continue? Or, do we need a corrective move first?
If there is a move lower, the 38.2-50% of the trend move higher over the last 8 or so hours, comes in at 110-279-339 area (see 5-minute chart below). The rising 100 bar MA on the 5-minute chart is approaching that area (at 110.26 now and moving higher). I would look for buyers on a dip near that area.
