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  • The USD/JPY pair reversed an early dip and has rallied around 30-pips from an intraday low level of 108.28, with bulls now still awaiting a sustained move beyond the 108.65-70 supply zone.  
  • The mentioned region has been acting as a key barrier over the past one month or so and should now act as a key pivotal point that might help determine the pair’s next leg of a directiona move.  

With technical indicators on hourly charts holding in the bullish territory and starting to gain some positive traction on the daily chart, a follow-through buying will confirm a near-term bullish breakout and lift the pair back towards reclaiming the 109.00 mark.

The mentioned handle represents 50-day SMA, above which a fresh bout of short-covering should provide an additional boost and assist the pair to extend the positive momentum further towards its next major resistance near the 109.60-70 region.  

On the flip side, rejection slide from the current barrier might continue to find some buying interest near the 108.00 handle, which if broken might turn the pair vulnerable to accelerate the slide further towards the 107.85-80 intermediate support en-route mid-107.00s.

USD/JPY daily chart