USD/JPY: At risk of one more down leg toward 140.20/139.60 on failure to defend 200-DMA near 143.40 – SocGen

USD/JPY retreats after rejecting the 50-Day Moving Average at 146.41 on Thursday. Economists at Société Générale analyze the pair’s technical outlook. 

Break above 146.60/147.40 essential for confirming extension in rebound

USD/JPY has rebounded sharply after forming interim low near 140.20 late last month. It has reclaimed the 200-DMA and approached October low of 146.60/147.40 which is an interim resistance zone. An initial pullback is taking shape.

It would be interesting to see if the pair can defend the 200-DMA near 143.40. Failure would mean risk of one more down leg towards 140.20/139.60.

Break above 146.60/147.40 is essential for confirming extension in rebound.