- The recent bullish move stalls near the very important 200-day SMA.
- The near-term technical set-up remains in favour of bullish traders.
The USD/JPY pair built on the overnight bullish breakthrough a one-week-old trading range and climbed to near three-month tops on Tuesday, albeit struggled to make it through the very important 200-day SMA barrier.
Given the recent move beyond a five-month-old descending trend-line and a subsequent consolidation above 50% Fibonacci level of the 112.40-104.45 downfall, the near-term bias seems tilted in favour of bullish traders.
Meanwhile, technical indicators on hourly/daily charts maintained their bullish bias and are still far from being the overbought territory, supporting prospects for an extension of the recent recovery move from multi-year lows.
However, traders are likely to wait for some strong follow-through buying interest beyond the 109.00 round-figure mark (200-day SMA) before positioning for a move towards reclaiming the key 110.00 psychological mark.
On the flip side, any meaningful pullback now seems to attract some dip-buying near the trading range resistance breakpoint, around the 108.70 region, and help limit the downside near the 108.40 support zone (50% Fibo.).
Sustained weakness below the mentioned support might prompt some technical selling and accelerate the fall further towards the 108.00 handle en-route the 107.70 region (descending trend-line resistance breakpoint).
USD/JPY daily chart
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