The yen weakened again on Wednesday as speculation about possible intervention by the Bank of Japan continues. Moreover, gain in Asian share markets gave pressure on the Japanese yen following Chinese trade data which offered hope that the economy of the country is stabilizing.
Japanese officials warned that a rapid appreciation by the yen was unwelcome. A rally on USD/JPY today took place without any significant news or comments from the Japanese official so it signaled that there was a huge demand for the USD over the yen.
From the technical analysis point-of-view, USD/JPY currently is in upward trajectory with some correction towards the Fibonacci support area at 109.024-108.804. 20 MA and 50 MA are rising on hourly chart. As today’s trading strategy, wait for bullish signal confirmation within the Fibonacci area as signal to go long with target at 109.161-109.381.
However note hourly stochastic has crossed down and CCI has fallen from the overbought area. Therefore, we should be careful if the price managed to break below the support at 108.804 because it will turn the intraday bias to bearish and possibly will be followed by a bearish move to 108.647-108.447.