USDJPY Regains Positive Traction for the 2nd Day in a Row

USDJPY Regains Positive Traction for the 2nd Day in a Row

USDJPY Price Analysis – February 24

USDJPY pair is trading at daily highs past the 106.00 level while extending its upside bias further. After Fed Chair Jerome Powell on Tuesday reiterated a very dovish policy stance on the economy, the USD downside risk has more or less dissipated and the current movement is viewed as part of a consolidation.

Key levels
Resistance Levels: 108.16, 107.05, 106.22
Support Levels: 104.92, 103.17, 102.60
USDJPY Long term Trend: Ranging
As seen on the daily chart, the USDJPY pair is building on the prior day’s rebound from levels below the key 105.00 psychological mark and gained positive traction for the 2nd day in a row. Considering the nearly overbought RSI, stepping back recently, the yen pair may fail to cross the former barrier at 106.22 level.

Meanwhile, the weekly support line, currently around 104.92 level, can offer immediate support to the pair in the event of an unexpected pullback. However, any further weakness below the daily moving averages 5 and 13 may return to test the recent low of 104.92 while also catching a breather around 105.00 round number.
USDJPY Short term Trend: Bullish
The pair’s near-term attention is now on 106.22 resistance level with today’s strong rally. A firm breach there may restart the increase from 102.60 low level, to 61.8% retracement of 111.71 to 102.60 at 108.16 levels.

The rejection by 106.22 level may usher in further consolidations but an increased rally may continue in favor as long as the 104.92 support level holds intact. Meanwhile, the breach of 104.92 level may imply ending of the increase from 102.60 level and alter near term bias bearish.

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Author : Azeez Mustapha

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Azeez Mustapha is an experienced author, trader, markets analyst, signals strategist, and funds-manager.