October 3, 2013 – USD/JPY (daily chart) has continued its gradual drift to the downside within a sideways trading range that the pair has been entrenched in for the past three months. The current mild bearishness has brought the pair down to approach key support around the 97.00 level and, in the process, recently began a dip below the 200-day moving average for the first time since November 2012.
This dip is significant because the 200-day moving average has served as major support for USD/JPY during the past several months. A breakdown below the noted 97.00 support level would confirm the significance of this price cross below the moving average, and could then look to target further downside support objectives around 95.00 and 92.00. In the event of a breakout above the short-term descending trend line extending back to September’s 100.60 high, upside objectives reside around the key 100.00 psychological level and then 103.00.
James Chen, CMT
Chief Technical Strategist
City Index Group
Forex trading involves a substantial risk of loss and is not suitable for all investors. This information is being provided only for general market commentary and does not constitute investment trading advice. These materials are not intended as an offer or solicitation with respect to the purchase or sale of any financial instrument and should not be used as the basis for any investment decision.
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