USDJPY – rising downside risk on repeated rejection at cloud top
The pair ticked higher on Tuesday, leaving temporary footstep at 112.36 (Mon/Tue lows) intact but remaining below initial barrier at 112.78 (daily Kijun-sen).
Monday’s close in red and repeated rejection at daily cloud top, as well as repeated failure to close above Kijun-sen, was bearish signal.
Risk of deeper pullback on loss of 112.36 handle and extension below 111.96 (daily Tenkan-sen) remains in play and scenario would include extension towards layers of strong supports, provided by converged 10SMA (111.80); 200SMA (111.68) and 100SMA (111.57).
Alternative scenario requires sustained break above cloud top (113.12) to signal continuation of recovery from 110.83 (27 Nov low).
Res: 112.78; 113.12; 113.24; 113.81
Sup: 112.36; 111.96; 111.80; 111.68