Yesterday the USD/JPY pair significantly declined.
The fall was due to poor macroeconomic statistics from the US and the absence of actual dates of the beginning of a rates increase in the speech of Fed Chair Janet Yellen.
The number of Initial Jobless Claims grew from 260 to 269 thousands, the Markit Services PMI for November fell from 56.5 to 56.1 points, while the ISM Non-Manufacturing PMI declined from 59.1 to 55.9 points. All indices came out worse than expectations. At the same time, Janet Yellen noted that the regulator will be considering the pace of the recovery of the US economy when making its interest rate decision.
Support and resistance
Bollinger Bands on the daily chart is moving horizontally while the price range is narrowing. MACD continues falling. Stochastic is also falling but is approaching the oversold zone.
The indicators recommend waiting for clearer trading signals.
Support levels: 122.60 (local low), 122.22 (16 November low), 122.00, 121.48, 121.00, 120.56, 120.34, 120.00 (28 October lows).
Resistance levels: 122.93 (local high), 123.25, 123.66 (2 December high), 124.00 (end of August high), 124.57.
Long positions can be opened after the breakout of the level of 123.00 with targets at 123.55, 123.70 and stop-loss at 122.70. Validity – 1-3 days.
Short positions can be opened after the breakdown of the level of 122.50 with targets at 122.30, 121.90 and stop-loss at 122.80. Validity – 1-3 days.