- USD/JPY build on its momentum further beyond the key 105.00 psychological mark.
- Bullish oscillators on hourly charts support prospects for further appreciating move.
- A sustained move beyond the 105.20-30 area needed to confirm the bullish bias.
The USD/JPY pair caught some fresh bids during the early North American session and jumped to one-week tops, around the 105.25 region in the last hour. The pair has now moved back above 200-hour SMA for the first time in nearly two-week, which supports prospects for additional gains.
The constructive set-up is reinforced by the fact that oscillators on hourly charts have been gaining positive traction. However, technical indicators on the daily chart are yet to recover from the negative territory and thus, warrant some caution for aggressive bullish traders.
This makes it prudent to wait for some strong follow-through buying beyond the 105.20-30 region before positioning for any further appreciating move. A convincing breakthrough should push the pair to the 105.55-60 intermediate resistance en-route the 105.80 region and the 106.00 mark.
On the flip side, any pullback towards the key 105.00 psychological mark might now be seen as a buying opportunity and remain limited near the 104.80 area. This is closely followed by 100-hour SMA, around the 104.65 region, which if broken will negate any near-term bullish bias.
USD/JPY 1-hourly chart
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Technical levels to watch
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