Technical Outlook USDJPY 22.09.2017

Technical Outlook USDJPY 22.09.2017

USDJPY – thick daily cloud offers strong support and contains dips for now

The pair trades in red on Friday, following Thursday’s rejection on first attempt at 112.80 target (Fibo 76.4% of 114.49/107.31 fall) and fresh pressure on the greenback after North Korea’s threats of another nuclear probe.
Dips were so far strongly rejected above daily cloud top (111.61) and subsequent bounce regained 112.00 handle.
Thickening daily cloud (111.61/110.43) offers strong support and renewed attempts higher could be expected while cloud top holds, with return above 200SMA (112.15) needed to generate stronger bullish signal.
However, negative signals are emerging from south-turning daily RSI which reversed on approach to o/b zone border and reversal of slow stochastic in deep overbought territory.
This may spark fresh downside and violate daily cloud top support (111.61), with extended dips to find next strong support at 111.00 zone (111.11 – converged 10/100SMA’s in attempt to form bull-cross and rising daily Tenkan-sen) which guards lower breakpoint at 110.43 (daily cloud base).

Res: 112.15; 112.55; 112.80; 113.00
Sup: 111.93; 111.61; 111.11; 110.97