USDJPY bulls are struggling to cross above 105.70 level amid another sell-off in the USD. The US dollar index has once dropped below 94.00 and the pair is currently trading at 105.54. The price pattern has turned bearish with immediate support at 105.15. The near term resistance is at 105.70 while the 106.00 level is acting as a stiff resistance area.

The intraday price pattern is strongly bearish, a couple of Dojis are present at the peak while yesterday’s closing has formed a bearish engulfing pattern. Moving averages on the other hand are giving a mixed signal. The SMA-21 is indicating support at 105.55 and the SMA-50 is showing resistance at 105.74. The mid-Bollinger band is at 105.250 while the upper and lower Bollinger bands are at 105.98 and 104.51 respectively. The Relative Strength Index is flat near 48 and the MACD lines gap is widening. The price on the intraday scale currently suggests selling entries in the pair for small profits. A decent selling entry would be at or near 105.70 with a target of 40 to 50 pips. A tight stop-loss for this trade would be just above the 106.00 resistance level.

Bears need a price action below 105.000 to consolidate further. On the upside, only an intraday closing above 106.00 would provide some space to the bulls.

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By LCMS Traders FX Analysis Team

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