USD/JPY Outlook: Risk Of Deeper Pullback On Break Below 10SMA

Technical analysis of Forex market

The pair stands at the back foot on Friday after double rejection under important 200SMA barrier and downbeat US retail sales on Thursday hurting the greenback.

Bearish extension in early Friday pressures pivotal supports at 110.22/19 (broken Fibo 61.8% / rising 10SMA), close below which would generate negative signal for deeper pullback.

Stochastic on daily chart emerged from overbought zone after forming bearish divergence, but flat momentum and RSI and daily MA’s in mixed mode, lack firmer signals.

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Friday’s close below 10SMA would signal temporary top at 111.12 and open way for test of 109.78 (20SMA) and 109.44 (30SMA).

Ability to hold above 10SMA would keep bullish bias for renewed attempt at 200SMA.

Res: 110.55, 111.12, 111.28, 111.40
Sup: 110.19, 109.78, 109.44, 109.15

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