USD/JPY rises to 112.70
An absence of any significant news in first half of the previous trading session expectedly led to a rebound from support zone located near the 112.10 mark. But then reports about agreement reached on tax reform by the House and Senate caused a spike up to the 112.70 mark. As further path to the north is obstructed by the falling 100- and 200-hour SMAs together with the weekly PP, the Dollar is unlikely to gain much value against the Yen. On the other hand, the 55-hour SMA in conjunction with the 50% Fibonacci retracement level should allow an active plunge as well. As a result, before the advent of some substantial news, the pair is expected to move horizontally between the above support and resistance barriers.
An absence of any significant news in first half of the previous trading session expectedly led to a rebound from support zone located near the 112.10 mark. But then reports about agreement reached on tax reform by the House and Senate caused a spike up to the 112.70 mark. As further path to the north is obstructed by the falling 100- and 200-hour SMAs together with the weekly PP, the Dollar is unlikely to gain much value against the Yen. On the other hand, the 55-hour SMA in conjunction with the 50% Fibonacci retracement level should allow an active plunge as well. As a result, before the advent of some substantial news, the pair is expected to move horizontally between the above support and resistance barriers.
In line with expectations, the currency exchange rate did not make any significant moves yesterday. To put it differently, despite the pressure from the weekly and monthly PP as well as the 100-hour SMA, a combination of the 55-hour SMA and the 50% Fibonacci retracement level managed to constrain the downfall.
As for today, the vote in Congress should lead to appreciation of the buck. In support of this scenario, 54% of pending orders in 100-pip range are set to buy. However, a concentration of the above technical indicators plus the 200-hour SMA most probably will either neutralize the surge or even cause a rebound and retreat back to support zone near the 112.10 level.