100 hour moving average is also in play
The USDJPY is trading in the confined range through the European morning session and into the New York session. Earlier in the Asian session the price did move lower and cracked below a lower channel trendline. However, the 100 hour moving average (blue line) was just below the trend line and proved to be "too much to ask" for the sellers. The price rebounded higher instead as traders leaned against the lower support risk defining level (the price has not been below the 100 hour MA since April 2).
On the topside, the 100 day moving average at 108.946 and the top channel trendline at 108.98 are targets to get to and through. The pair has traded above and below its 100 day moving average over the last 2 trading days. In fact, the price did peak above the level earlier today as well but failed.
Overall, the narrow trading range - within a defined channel - suggests the market is unsure of the next momentum move. However, traders will look for a break outside the ranges with momentum.
Should the topside resistance be broken, the next key target would be at 109.309 which is home to the 50% retracement of the move down from the March 24 high.
On the downside, if the 100 hour moving average and lower trend line is broken, the 200 day moving average at 108.312 and 200 hour moving average at 108.215 will be the next key targets.
