USDJPY rebound has limited upside room
USDJPY bounced off 131.25-50 horizontal support area despite multiple failures to cross the 50-DMA, not to forget the monthly resistance line. The recovery moves, however, appear to lack support from the oscillators, which in turn suggests another play of inability to cross the aforementioned key hurdles. Even if the quote manages to cross the one-month-old resistance line and the 50-DMA, respectively near 134.60 and 135.30, the monthly high around 135.60 and June’s peak of 137.00 will be tough challenges for the pair buyers to keep the reins.
Meanwhile, a four-month-old horizontal support area close to 131.25-50, comprising the 100-DMA and 61.8% Fibonacci retracement of May-July upside, becomes a tough nut to crack for the USDJPY bears. In a case where the pair drop below 131.25, the monthly bottom of 130.40 and the 130.00 psychological magnet will be important supports for the sellers to watch.
Overall, USDJPY consolidates the previous monthly fall but the road to the total recovery is a bumpy one.
