USD/JPY – 101 Defended, Time to Capture 103

USD/JPY - 101 Defended, Time to Capture 103

USD/JPY has been drifting, with downward pressure towards the low on the year around 100.75. The 100.75-101 area is a key support area and traders seem to have defended it well last week, as we can see in the 4H chart.

USD/JPY 4H Chartusdjpy 6/1/2014

You can argue that an inverted head and shoulders pattern emerged as the market put on a higher low around 101.50 after defending the 101 area.

102 was a key level last week, and the market wavered around it last week. To start this week, we are seeing another attempt to clear it. A break above 102.15 should put 102.35 and 102.70 in the near-term scope. However 103 is the level to break for a directional signal outside of the intra-session time-frame.

USD/JPY Daily Chart
usdjpy daily chart 6/1

Consolidation Resistance:
Roughly, the 101-103 level represents USD/JPY’s consolidation range for the past 2 months, as well as the one in February. A break above 103 will shift the focus from the 101 support area to the 104.13 pivot and the 105.44 high on the year.

Key Support:
While 103 is key resistance, 100.75 is an ever more significant support. A break below this clears the moving averages (200,100,50), and opens up the 100, then 99.00 handles in the short-term, and maybe even the lows around 97.00, which was the origin of the upswing that went to this year’s high.

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Fan Yang has been a professional forex trader and analyst since 2007. He specializes in technical analysis and has a Chartered Market Technician designation since 2011. He was the chief technical strategist at CMSFX He was also the founder and chief currency strategist at FXTimes Over the years, Fan has not only been a trader and analyst but also an educator. As a proponent of both technical and fundamental analysis in trading, Fan advocates simplicity and discipline as key factors in making trading decisions when faced with so many "clues" and "signals". Currently Fan Yang is the chief currency analyst and webinar instructor at