USDJPY failed to further its recent rally on Monday, leaving Friday’s 84.72 high untested and coming off on the session as low as 83.85. Nevertheless, USDJPY has moved higher in early Tuesday’s session to a high point of 84.47.
Although the rate exceeded important resistance at 84.51 on Friday, it subsequently pulled back. The next important level to the upside is at 85.92. Initial support for USDJPY is now seen at 80.69, but the 76.41 level remains the key support level to break in order to see further downside for USDJPY.
Until that key level gives way, additional upside corrective activity should prevail for the rate, especially as it has now significantly exceeded its 200 day Moving Average that is currently at 83.56 and falling. This important crossover shifts the medium term outlook for USDJPY to neutral from bearish.(FXNW)