USD/JPY Price Analysis: Prints long-tailed candle on 10-day MA

• USD/JPY has faded the drop below the 10-day moving average.
• The pair could challenge higher hurdles with the S&P 500 futures flashing green. 

USD/JPY is currently trading largely unchanged on the day at 108.84, having hit a low of 109.72 in early Asia. 

The recovery has taken the shape of a long-tailed candle on the daily chart. Notably, the bullish candle has appeared at the ascending 10-day average support and suggests the path of least resistance is to the downside. 

The pair could challenge last week's high of 110.13 and may break higher if the mild risk-on in the equity markets seen at press time gathers steam, sending the safe-haven JPY lower.

A violation at 110.13 would expose the 2020 high of 110.29 reached on Jan. 17. 

On the downside, acceptance under 109.62 (Feb. 13 low) would imply the rally from the Jan. 31 low of 108.31 has made a temporary top and could bring a deeper slide to 109.00. 

Daily chart

Trend: Bullish

Technical levels