USD/JPY on track to test 50-DMA at 102.74, good to long dips

FX:USDJPY   U.S. Dollar/Japanese Yen
451 0 13
Hawkish comments from Fed’s Yellen on Friday has triggered broad-based USD rally.

USD/JPY             opened Monday with a 25-pip bullish gap and is trading 0.48 pct higher on the day around 102.23.

The pair has broken 20-DMA and momentum has turned bullish . Stochs, RSI and CCI indicate further upside in the pair.

Scope for test of 50-DMA at 102.74, violation there could see test of 103.51 (50% Fib) and then major trendline resistance and 61.8% Fib at 104.45.

Supports on the downside are seen at 101.41 (23.6% Fib), 101.06 (20-DMA) and 100.87 (Aug 5 low).

US personal spending and income report due later today will be in focus for further direction.

Good to buy dips around 102 levels, SL: 101, TP: 102.75/ 103/ 103.50
Comment: USD/JPY edges lower from highs of 103.22. Book partial profits.

Slight weakness on hourly charts.

Strong support at 102.83, break below could see drag upto 102.40.
Comment: All targets hit. Book partial profits.

Raise trailing stops to 103.20, target 104.

Focus on US ISM Manufacturing and Markit’s PMI data due later in the NA session.
Comment: Pair hit 104 before turning lower on poor show in US ISM data overnight.

Focus on US NFP later today in the NZ session.

Bias neutral for now.
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