USD/JPY: Technical Outlook

USDJPY is heading for the third negative day as prevalent pessimism at US and delayed tapering of US monetary easing program weakened US Dollar.

On Monday, Federal Reserve Bank of New York President, William Dudley, said “the economy still needs support”, indicating the continuation of monetary easing and devaluation of Dollar. The pair closed below 50% Fibonacci Retracement Level of its downturn from 103.73 to 93.78.

On Tuesday, US CB Consumer Confidence fell below expectation of 79.9 by being at 79.7 level, the previous release indicated 81.8 level, which further pressured the pair towards weaker end.

The pair is currently trading near 98.50 level, near the ascending trend line support connecting the lows of 95.80 and 97.98.

From the current level, the pair is having immediate support level of 98.30 (ascending trend line), breaking which the pair test 97.75 – 97.50 support zone (including 200-day SMA and 38.2% Fibonacci Retracement Level).

Given the pair continue to trade below 97.50 support level, it is vulnerable to test 96.20 – 96.10 support zone.

On the upper side, 99.20 becomes an immediate resistance level to watch, breaking which the pair can test 99.85 – 100 resistance zone (including 61.8% Fibonacci Retracement Level).

Sustained break out above psychological level of 100, the pair can head towards 101.30 with 100.70 – 100.80 being intermediate resistance zone.

US economic calendar is filled with two releases today, namely, Core Durable Goods Orders and New Home Sales, which bear positive forecasts. Given the actual releases match forecasts, US Dollar may regain some strength; otherwise, the greenback is expected to continue on its weaker path against rest of its counterparts.

 Original Article: Admiral Markets and hyper link Admiral Markets with http://www.admiralmarkets.com/