Last week, in our article we pointed out this technical correction of the USD / JPY pair, you can review it and obtain some data that can serve you for the future when similar movements occur.
The USD / JPY pair touched its highest level in more than a year at 111.67 on Friday. Later on the same day, the USD / JPY pair fell sharply after the announcement of the US Nonfarm Payrolls (NFPs). Now the currency pair is below the SMA of 21 and below 8/8 of murray, showing a bearish signal in the short term.
Despite the better-than-expected nonfarm payroll report for June, the market had priced in the result a few days earlier. So, the yen declined to +2/8 murray levels. Then, the market responded to the actual employment data and therefore we saw a correction of the Japanese Yen. Now we notice that the yen has an immediate support in the 6/8 area of murray.
The 4-hour chart shows that the pair is below the 21 SMA. As long as it is holding below this zone, the outlook will continue to be bearish for the Japanese yen. Thus, any attempt to break the 111.17 zone will be a good opportunity to sell with targets at 110.15.
The technical reading of the eagle indicator suggests that there is a bearish signal and the pair could be approaching the overbought level. Therefore, our recommendation is to sell below 111.17 and below 110.93, the 200 EMA will be a good support in the short term.
Support and Resistance Levels for July 06 - 07, 2021
Resistance (3) 111.63
Resistance (2) 111.35
Resistance (1) 111.13
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Support (1) 110.73
Support (2) 110.56
Support (3) 110.34
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Trading tip for USD/JPY for July 06 - 07, 2021
Sell if pullback 111.17 (SMA 21), with take profit at 110.50 and 110.15 (6/8), stop loss above 111.52.
