Bulls face strong headwinds at key resistance zone
The pair eases on Tuesday, following re-peated rejection under key barriers at 108.92/99 (Fibo 38.2% of 112.40/106.78 / 10 July high), weighed by losses of GBPJPY which leads JPY gamma.
Bulls face difficulties to progress within thick falling daily cloud, with negative signal developing on daily stochastics’ reversal from overbought zone and RSI turning south.
Flat momentum at the centerline adds to signals.
Fresh easing pressures pivotal support at 108.50 (55DMA), break of which is needed to generate initial bearish signal and expose key support at 108.24 (daily cloud base / near Fibo 38.2% of 107.21/108.94 bull-leg / converged 10/20DMA’s).
Pullback needs to find ground above cloud base and turn up to keep bulls in play, while firm break lower would confirm reversal and open way for further weakness.
Ability to hold above 55DMA would keep immediate focus at the upside for renewed attack at 108.99 pivot.
Res: 108.92; 108.99; 109.59; 109.69
Sup: 108.50; 108.24; 108.08; 107.87