USD/JPY Forex Technical Analysis – Trading on Strong Side of Short-Term Pivot at 108.632

The Dollar/Yen is inching higher early Monday with the Forex pair basically mirroring the price action in the September 10-year Treasury note futures contract. There are no major economic releases scheduled for Monday so traders are keeping their powder dry. At 12:05 GMT on Monday, BOJ Governor Kuroda is scheduled to speak, but his comments are not likely to move the needle much.

At 13:02 GMT, the USD/JPY is trading 108.969, up 0.020 or +0.02%.

We could get some upward movement in the Dollar/Yen if volatility in the cryptocurrency and stock markets surges. This could trigger a flight-to-safety rally into the U.S. Dollar.

Daily Swing Chart Technical Analysis

The main trend is down according to the daily swing chart. A trade through 109.785 will change the main trend to up. A move through 107.479 will signal a resumption of the downtrend.

The minor trend is up. A trade through 108.337 will change the minor trend to down and shift momentum to the downside.

The short-term range is 110.966 to 107.479. Its retracement zone at 109.223 to 109.634 is resistance. It’s also controlling the near-term direction of the USD/JPY.

The minor range is 107.479 to 109.785. Its 50% level at 108.632 is support.

The major support is the 108.230 to 107.154 retracement zone. The recent main bottom at 107.479 was formed inside this zone.

Daily Swing Chart Technical Forecast

Last week’s price action suggests the direction of the USD/JPY will be determined by trader reaction to 108.632.

Bullish Scenario

A sustained move over 108.632 will indicate the presence of buyers. If this move creates enough upside momentum then look for the rally to possibly extend into the short-term 50% level at 109.223. Sellers could come in on the first test of this level. Overtaking it will indicate the buying is getting stronger with the short-term Fibonacci level at 109.634 the next target.

Bearish Scenario

A sustained move under 108.632 will signal the presence of sellers. Taking out 108.373 will indicate the selling is getting stronger with the next targets a minor bottom at 108.337 and the main Fibonacci level at 108.230.

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