The USDJPY has been trending higher over the last few days, and in the process has been able to move above the 38.2% retracement of the trend move down from the November high. That level comes in at 144.698. Above that was the December 19 high at 144.938. The high-price today reached 144.74 and has rotated back to the downside.
The current price is back below the 38.2% retracement and that failure threatens the upside momentum. If the price cannot get up back above the 38.2% retracement, the corrective movie is just a plain-vanilla variety. We could see buyers turn back to sellers. As is there is a reason to sell against the 38.2% with a stop on a move back above.
For traders looking for more downside confirmation, a look at the 5-minute chart shows the rising 100-bar moving average. If the price can move below that moving average, we could see more selling on the back of weaker short-term intraday technicals, and the failure above the 38.2% retracement.
Be aware. Be prepared.
This article was written by Greg Michalowski at www.forexlive.com. Source