Failed again and the sellers turned to buyers

Earlier in the day, the USDJPY fell below the 100 hour MA despite:

  • Better US data
  • Higher yields
  • Higher stocks

At the time I warned how the momentum had failed on the recent dips below the MA lines (see post here).

Technically, looking at the hourly chart above, the break below the 100 hour MA failed (blue line the chart above). The price moved above a topside trend line on the hourly chart, and the sellers turned to buyers. The price surged higher.

The price move has traded to new highs since July 20.

What next?

Looking at the daily chart below, the price is moving away from the 112.146 area. Yes, the price dipped below that level as the price tested and broke the 100 hour MA, but is running away from the level now. The pair is in the area that formed an extreme back in July. The high peaked at 113.169. That is a target.

Before then, the 112.617 was the high on the day the extreme move failed. The 112.92 is the underside of the broken trend line.

SUMMARY: Buyers are in control and moving away from technical levels. The pair is in an extreme area that failed in July but traders have to respect the break higher and look for a run toward the high. Close risk could be near the high from yesterday at 112.44. Below that, the 112.146 and the rising 100 hour MA at 112.127, are also key level. It would take a move below each (AND staying below the 100 hour MA!) to get traders thinking of more meaningful declines.