Slips from bull’s radar, symmetrical triangle in focus
- USD/JPY remains depressed inside a fortnight-old triangle after reversing from one-week high.
- Convergence of 100-EMA, descending trend line from mid-December guards immediate upside.
- Sluggish RSI, multiple hurdles to the north challenge buyers.
- 200-EMA acts as the last defense for bears.
USD/JPY stays pressured around the 130.00 round figure, following a pullback from the one-week high, as the Yen pair traders remain cautious ahead of the Federal Reserve (Fed) monetary policy outcome on Wednesday.
Technically, the two-week-long symmetrical triangle restricts the immediate USD/JPY moves.
That said, the pair’s latest weakness could be linked to the failure to cross the downward-sloping resistance line from December 15 and the 100-bar Exponential Moving Average (EMA), around 130.30 by the press time. Also challenging the USD/JPY buyers could be the sluggish RSI (14) line.
It’s worth noting, however, that the pair sellers need to conquer the stated triangle’s support line, around 129.50 at the latest, to retake control. Following that, a slump toward the previous monthly low of 127.21 can’t be ruled out.
Alternatively, the 130.30 resistance confluence restricts immediate USD/JPY upside ahead of the aforementioned triangle’s top line, close to 130.55 as we write.
Should the Yen pair remains firmer past 130.55, the 200-EMA level surrounding 131.75 will act as the last defense of the bears, a break of which may open doors for the quote’s run-up towards the previous monthly high near 134.80.
USD/JPY: Four-hour chart
Trend: Pullback expected