- USD/JPY bulls retreat from three-week-old horizontal resistance.
- RSI pullback favors sellers but 100, 50 and 21-SMAs probe further declines.
- Six-week-old support line adds to the downside filters, double tops around 116.35 appear tough nut to crack for bulls.
USD/JPY struggles to keep the bounce off intraday low around 115.45 ahead of Friday’s European trading session. Even so, the yen pair remains firmer on the weekly basis, marking the second week-on-week gains by the press time.
Sustained trading beyond multiple SMAs and an upward sloping trend line from January 24 joins firmer RSI to keep USD/JPY buyers hopeful.
Considering the quote’s latest rebound from the 100 and 21-SMA, near 115.30 at the latest, USD/JPY prices may approach a broad resistance area established since February 10, close to 115.80-90.
It should be noted, however, that the double tops around 116.35, comprising highs marked during early January and February, will be crucial resistance to watch afterward.
Alternatively, a 50-SMA level around 115.20 adds to the aforementioned SMA supports, a break of which will direct USD/JPY bears towards the multi-day-old rising trend line near 114.90.
In a case where the bears keep reins past 114.90, late February’s low near 114.40 should return to the chart.
USD/JPY: Four-hour chart
Trend: Further weakness expected