USD/JPY reversal risk grows

From the FXWW Chatroom: While the long-term scope remains for a break below 110.35 which would trigger further losses to mid 106.00s, the long hammer candlestick line on Wednesday and failure to break the recent 2016 110.99 low has evened out nearer-term sentiment giving bears something to think about. The risk of a corrective reversal has grown but a number of important upside levels needs daily closes above to keep any recovery alive. Bulls need to overcome the tenkan line at 112.96 and Feb 16’s 114.87 high, but they will likely be bound by 115.08 – 38.2% retracement of the 121.70-110.99 (Jan/Feb) drop. A daily close above 115.08 however, will likely put expected losses on hold.

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