USDJPY has become volatile and corrective after reaching 104.80 to 105.00 event level. USDJPY is facing resistance around 105.00 psychological area. Bears to regain momentum in the coming days? What are the charts and technical indicators are saying? Read more to find further insights into today’s USD/JPY Technical Analysis.
February 2, 2021, | AtoZ Markets – USDJPY is currently trading around 104.97 area and trying to push lower. After bouncing from the dynamic level of 20 EMA, the bulls pushed the price higher quite impulsively and gained more than 140 pips. As per the current price action, the price may face strong resistance around 104.80 to 105.00 level in the days ahead.
Along with this, the Federal Reserve policymakers mentioned on Monday, the U.S. economy is still somewhere down in a downturn, and more financial alleviation will be expected to arrive at a full recuperation and help a portion of the secure jobless positions. On the contrary, Kazumasa Iwata, the former deputy governor, said that the Bank of Japan will probably permit long haul interest rates to move all the more generally around its 0% objective and lessen acquisition of super-long securities to steepen the yield curve.
USDJPY Facing Resistance as Fed Authorities Say U.S. Economy Still in the Depths of the Downturn
USDJPY is currently residing near 104.97 area and trying to push the price downward. However, the price is still residing over the dynamic level of 20 EMA on the intraday chart.
Image: USDJPY 4 Hour Chart
According to the 4-hour chart, USDJPY is facing resistance and currently trading around 104.97 area. As per the current price action, if the price can have an impulsive bearish candle close below 105.00 to 104.80 resistance level, the bears may regain momentum and decline towards 104.20 to 104.00 area in the coming days.
In addition, the dynamic level of 20 EMA is currently residing below the price. It may work as strong support to push the price upside. So, the bears may regain momentum if the price can break below the dynamic level in the process. Besides, the MACD lines are currently residing over the 0.00 level and may have a bearish crossover. Also, the histograms gradually sloping downside. Both indicate that the bears may regain momentum in the days ahead.
USDJPY May Revert Back to the Mean
According to the daily chart, USDJPY is facing resistance, but the bulls are still optimistic. As per the current scenario, if the price can have an impulsive daily bearish candle close below 105.00 to 104.80 area, the price may retrace towards 104.20 to 104.00 area in the coming days. So, if the price retraces towards 104.20 to 104.00 area and bounced upside with a daily bullish candle, the bulls may sustain the bullish pressure towards 104.80 to 105.00 area as a first target. The second target will be 105.80 to 106.00 area in the process.
Image: USDJPY Daily Chart
Furthermore, the dynamic level of 20 EMA is currently residing below the price. Along with the Kijun line and the Tenkan line. So, the dynamic level may pull the price downside as a mean reversion. Besides, the Kijun line and the Tenkan line may work as a confluence of the dynamic level in the days ahead.
To conclude, the bulls may sustain the bullish pressure further, but required a downside retracement. A daily close is needed to identify the definite momentum in the coming days.