- The 50-hour moving average gives support for up-move.
- Hourly RSI in bear territory puts doubt on bullish strength.
USD/JPY bulls managed to pull back the pair from the daily low of 106.05 with help from the risk-on market environment. Hopes of coronavirus vaccine and the US stimulus deal drove the equity rally signifying the ebullient market mood.
The Treasury yields supported the US dollar, but the greenback couldn’t run up much as the safe-haven appeal was not in vogue, capping the USD/JPY upside.
The spot crawled back from a dip below the 50-hour simple moving average – around 106.10.
The bullish 21-hour moving average and the horizontal 100-hour moving average meet around 106.18, which would attract fresh selling.
A decisive break above 106.18 will give more momentum to the bulls, and then the falling trendline resistance at 106.28 will be the next challenge to surmount.
The 50-hour moving average supports the pair, but a move below that could trigger fresh selling, and bears will target 106.00.
The Relative Strength Index is in the bear territory, around 47.30, below the index-midline, indicating potential weakness head.
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