FxWirePro: USD/JPY rejected at highs, weakness likely on break below channel base at 108.72

• USD/JPY was rejected at highs at 109.40, slips lower to currently trade at 109.13 levels.
   
• The pair is extending consolidation along strong support by channel base at 108.72.
   
• Only a decisive break below will see further weakness in the pair. Upside remains capped below 20-DMA currently at 109.80.
   
• Successive Doji formation on weekly charts along with bullish Stochastics divergence on dailies raises scope for upside.
   
• Absence of any direct monetary policy related comments by either Yellen or Draghi during their Jackson Hole speeches keeps the pair subdued.
   
• Break above 20- DMA could see reversal. While on the downside, break below channel base at 108.72 could see drag upto 108.13 (Apr 17 low).

Support levels - 109, 108.72 (Channel base), 108.13 (Apr 17 low)

Resistance levels - 109.31 (5-DMA), 109.80 (20-DMA), 110, 110.95 (Aug 16 high)

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