The USDJPY is trading at new highs and in the process is testing the highs from last week at 137.85. The high price just reached 137.836.
Looking at the daily chart, the price has also moved back above the broken 38.2% retracement of the 2022 trading range at 137.24 and above the November lows which came in at 137.65 (on November 15) and the 137.485 (on November 28). Staying above the 38.2% is now close risk for the buyers looking for more upside momentum.
On December 1, the price moved below the aforementioned 38.2% on its way to a December low at 133.61.That break lower saw the pair move below the 200 day MA (green line) as well. That was the first break below the 200 day moving average going back to February 2021. The price closed below that MA for 1 day, but could not sustain the momentum and the sellers turned back to buyers on the failed break.
The low from Friday reached 135.593 ahead of the 200 day MA.
With the 38.2% now close risk for buyers the rising 200 day MA is a more conservative risk levels for traders looking for more upside momentum. That level comes in at 135.15 and moving higher.
With the CPI coming up tomorrow and the Fed decision on Wednesday, the buyers are positioning away from the support levels below (i.e the 200 day MA). Through the release, a higher number could see the pair move through the swing area on the daily between 139.31 to 140.308, and above that the 100 day MA at 141.092.
On a weaker number, the 200 day MA will be eyed for the 2nd break this month.