The uptrend in USDJPY remains intact and the pair touched a fresh cycle high of 145.93 Wednesday. Recent gains resulted in a break of resistance at 145.07, Jun 30 high, confirming a resumption of the uptrend and maintaining the bullish price sequence of higher highs and higher lows. MA studies are in a bull mode condition, highlighting bullish sentiment. The focus is on 146.38, a Fibonacci projection. Initial support to watch is 143.03, the 20-day EMA.
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The pullback in USDJPY paused to begin the week, warding price action away from entering a technically oversold condition. Despite the pause, the bear cycle that started Jun 30 is still underway. The recent sell-off has resulted in a break of both the 20- and 50-day EMAs and price is back inside the bull channel drawn from the Jan 16 low. A continuation lower would open 136.57, the lower band of a moving average envelope. Initial firm resistance is at 140.18, the 50-day EMA. A break of this average would ease bearish pressure.
A new survey from YouGov has found that, “Despite incremental improvements in the U.S. economic situation — including the inflation rate reaching a two-year low in June — American views of the state of the economy remain quite negative.”
Figure 1: About Half of Americans say the U.S. Economy is in Recession
Source: YouGov