- USD/JPY stays above 200-bar SMA after Wednesday’s sharp recovery.
- Multiple lows marked during late-December cap immediate upside.
- Overbought RSI signals the pullback, sellers can revisit Tuesday’s top during decisive declines.
USD/JPY holds onto recovery gains from Wednesday while taking the bids to 109.20 during early Thursday. The pair remains above 200-bar SMA while confronting near-term key resistance area.
Considering the overbought conditions of RSI and the strength of multiple lows marked between December 19 and 25, buyers will wait for a sustained break of 109.30 before taking a fresh entry.
In doing so, 109.60 and the Christmas 2019 high of 109.80 could be on their radar ahead of 110.00 round-figure.
Alternatively, sellers can sneak in if the quote slips below 200-bar SMA level of 109.00, which in turn will highlight early-week top near 108.60 as the follow-on support.
Should there be increased selling pressure below 108.60, 107.80 and the recent low near 107.65 will return to the charts.
USD/JPY four-hour chart
Trend: Pullback expected
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