On Tuesday, the USD/JPY currency pair jumped to the 106.60 level. During today’s morning, the pair was testing the Fibo 38.20% at 106.86.
If the given level holds, it is likely that a reversal south could occur in the nearest future. In this case it is unlikely that the exchange rate could decline below the support area formed by the 55-, 100– and 200-hour SMAs, as well the weekly and monthly PPs in 105.80/106.25.
Meanwhile, note that the currency pair could gain support from the weekly R1 located at 106.51. Thus, it is likely that the Greenback could trade sideways against the Japanese Yen in the short term.
