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The Japanese Yen may be preparing to launch a recovery against the US Dollar after USD/JPY produced a bearish Evening Star candlestick pattern. Near-term support is at 102.65, the 23.6% Fibonacci expansion, with a break below that on a daily closing basis exposing the 38.2% level at 101.96. Near-term resistance is at 103.75, the March 7 high.
Prices are too close to relevant support to justify a short position from a risk/reward perspective, while a viable reversal signal arguing in favor of a long trade is absent. We will remain on the sidelines for now until a more actionable setup presents itself.
Daily Chart - Created Using FXCM Marketscope 2.0
--- Written by Ilya Spivak, Currency Strategist for DailyFX.com