USD/JPY Is Facing Uphill Task Near 110.00
- USD/JPY dipped towards 109.10 before correcting higher.
- A major hurdle is forming near 109.90 and 110.00 on the 4-hours chart.
- EUR/USD extended its decline below the key 1.1780 support.
- GBP/USD traded below the 1.3800 support zone, but it is still above 1.3720.
USD/JPY Technical Analysis
The US Dollar reacted to the downside from the 110.20 zone against the Japanese Yen. USD/JPY tested the 109.10 zone and recently started a fresh increase.
Looking at the 4-hours chart, the pair recovered above the 109.25 and 109.40 resistance levels. There was also a break above the 50% Fib retracement level of the downward move from the 110.16 swing high to 109.10 low.
However, the pair failed to clear the 109.90 resistance. It seems like there is a major hurdle forming near the 110.00 level, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).
There is also a connecting bearish trend line forming with resistance near 109.90 on the same chart. The trend line is close to the 76.4% Fib retracement level of the downward move from the 110.16 swing high to 109.10 low.
To start a fresh increase, the pair must clear 109.90 and 110.00. If not, the pair might start a fresh decline below the 109.50 level.
On the downside, an initial support is near the 109.25 level. The main breakdown support is near 109.10. Any more losses might push the pair towards the 108.40 support zone in the near term.
Looking at EUR/USD, the pair failed to stay above the key 1.1780 support and extended its decline. Similarly, GBP/USD traded below the 1.3800 support zone, but it might find bids near 1.3720.
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