USD/JPY advances within tight consolidation
James Chen March 5, 2014 9:19 PM
<p>USD/JPY (daily chart) has advanced during the first half of this week but continues to consolidate within a tight trading range that has been in […]</p>
USD/JPY (daily chart) has advanced during the first half of this week but continues to consolidate within a tight trading range that has been in place for the past month. This consolidation is highlighted by the fact that the currency pair has been oscillating squarely between its 50-day and 200-day moving averages since late January, suggesting a non-trending, directional indecision. The current trading range occurs after the pair hit a five-year high of 105.43 in the very beginning of the year to cap off a steep bullish trend, before pulling back to a low of 100.75 in early February.
Since that pullback to 100.75, the pair has been struggling to find direction. Currently having risen to approach both its range high around 102.80 as well as the noted 50-day moving average to the upside, USD/JPY could soon rebound and emerge from the trading range to once again seek its recent highs. A breakout above 102.80 would provide an indication of this rebound, with further upside resistance targets around 103.70 and then 105.00. Downside support continues to reside around the noted 100.75 range low and the 200-day moving average to the downside.