(Chart courtesy of FX Solutions' FX AccuCharts. Price on 1st pane, Slow Stochastics on 2nd pane; uptrend line in green; downtrend lines in red; horizontal support/resistance level in yellow; 200-period simple moving average in light blue.)
6/17/2008 – USD/JPY – After breaking cleanly out of a key downtrend resistance line (the top red line) last week, price action on USD/JPY, the daily chart of which is shown, appears poised for a possible throwback to the line. Oscillators like the displayed Stochastics are in extremely overbought territory and beginning to arc back down. This suggests that momentum on the break may have waned. In the event of this move back down, several currently coinciding support factors exist to the downside. First and foremost is the red downtrend resistance line that price just broke out of last week. The second major support factor is the yellow horizontal support/resistance level at around 105.50, which has acted recently as significant support and resistance. The third support factor resides in the medium-term green uptrend line, which has provided dynamic uptrend support since mid-March.
Chief Technical Analyst
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