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Talking Points:
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USD/JPY Technical Strategy: Flat
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Support: 107.89, 106.54, 105.44
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Resistance: 108.72, 110.08, 110.65
The US Dollar continues to move lower against the Japanese Yen as expected, with prices sinking to touch a two-week low. Near-term support is at 107.89, the 23.6% Fibonacci retracement, with a break below that on a daily closing basis exposing the 38.2% level at 106.54. Alternatively, a reversal above the 14.6% Fib at 108.72 clears the way for a test of the October 1 high at 110.08.
Prices closed too close to support to justify entering short from a risk/reward perspective. On the other hand, the absence of a defined bullish reversal signal suggests taking up the long side is premature. With that in mind we will remain flat for now.
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Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com
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