USD / JPY ideally remains capped by its 55-day average and recent highs of 104.75 / 77 with dominant risk heading lower, analysts at Credit Suisse explain.
Key statements:
“USD / JPY strength has been capped as expected before the top of its range and to the 55-day average at 104.75 / 77, which if held, would keep risks to the downside.”
“Support initially moves to 103.92, then 103.63, below which the downtrend should reassert itself with potential March trend support seen at 103.45 today, and more importantly at the early November low at 103.20 / 17. While it should be estimated that it can slow down here, an eventual break may resolve last month’s range to the downside for a more concerted decline with support seen at 102.80 / 74 and eventually and more importantly at 101.63 / 18 “.
“Short-term resistance moves to 104.29, then 104.59. Above 104.75 / 77, instead, a bottom would be seen to suggest that a more sustained rally may emerge with resistance seen below at the potential downtrend at 105.11 / 18, then more important price resistance follows at 105.68 / 75 “.
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