The USD/JPY pair registered strong growth in the short term and now it seems exhausted. It was trading at 144.49 at the time of writing. Technically, the bias remains bullish but we need confirmation before going long again.
Fundamentally, the USD/JPY pair stayed higher after the CB Consumer Confidence and the New Home Sales indicators came in better than expected yesterday. Today, the US data came in mixed. The Goods Trade Balance was reported at -87.3B versus -88.9B expected, Prelim Wholesale Inventories reported a 1.3% growth versus 0.4% growth expected, while Pending Home Sales reported a 2.0% drop compared to the 0.9% drop estimated.
Tomorrow, the US Final GDP and the Unemployment Claims could have an impact on the USD/JPY pair.
USD/JPY Exhaustion Signs!
Technically, the rate developed a strong leg higher after registering a false breakdown below the ascending pitchfork's median line (ml) and after failing to stabilize under 141.50. Now, it was almost to reach the 144.99 static resistance.
After its strong growth, a temporary retreat is natural. So, the resistance is represented by 144.99 while the immediate support is seen at 144.05.
The bias is bullish, so staying above 144.05 and making a valid breakout through 144.99 activates further growth towards the R1 (146.02). This is seen as a long opportunity.
On the other hand, dropping below 144.05 opens the door for a larger retreat towards the weekly pivot point of 143.18.