USD/JPY holds a slight bounce to trade around 104.80 levels today

The pair is currently gyrating around its 100-hour moving average @ 104.83 but I would say that isn't quite a key level for the time being as price action hovers in between a couple of other key levels ahead of the weekend.

Of note, the slight bounce in the second-half of the week comes after sellers drove price towards the 100-day moving average (red line) and buyers defended that level.

That now puts the focus back on 105.00 as the key line in the sand limiting downside, with there being large expiries at 104.95-00 rolling off today as well as the 200-hour moving average @ 105.03 currently.

As such, buyers need to break above that in order to establish further upside momentum again in trying to target the 200-day moving average (blue line) @ 105.53.

As much as the pair tends to follow risk sentiment at times, I would argue that the dollar side of the equation is the key factor at play at the moment.

Risk is looking more tepid with the long weekend in focus and if the dollar does gain some ground later on in the day, that could push USD/JPY to test the resistance levels closer to the 105.00 level in the sessions ahead.

The bond market is also another key element to watch but yields are looking like they are consolidating for the most part, so there might not be much to that today.

As for downside momentum in USD/JPY, sellers need to try and break below the 100-day moving average @ 104.39 to extend another leg lower in the day(s) ahead.

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