USD/JPY Technical Analysis: re-test of 100-hour EMA support likely on bearish RSI divergence

• The USD/JPY has backed-off from the four-year high of 114.55 and could drop further to the ascending (bullish) 100-hour exponential moving average (EMA), currently located at 113.79 as the hourly chart is flashing a bearish divergence of the relative strength index (RSI).
• The RSI has rolled over from the overbought territory and the MACD has produced a bearish crossover.
• A strong bounce from the 100-hour EMA support could yield a rally to fresh four-year highs above 114.59, while an acceptance below the MA support would allow a deeper pullback.
• It is worth noting that the pair has created a series of higher lows along the 100-hour EMA since Sept. 17, which makes it a key level to watch out for in the near-term.  

Hourly Chart

Spot Rate: 114.25

Daily High: 114.55

Daily Low: 114.22

Trend: Pullback likely

Resistance

R1: 114.55 (session high)

R2: 114.74 (November 2017 high)

R3: 115.00 (psychological hurdle)

Support

S1: 113.79 (100-hour EMA)

S2: 113.52 (support of Oct. 2 low on the hourly chart)

S3: 113.41 (200-hour EMA)