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USD/JPY is currently flirting with key resistance at 111.46, having picked up a strong bid near 111.20 an hour ago.  

The 26 pip rise has invalidated the bearish view put forward by the rising channel breakdown confirmed yesterday.  

Should the pair find acceptance above 111.46, then a sideways channel breakout would be confirmed. That would open the doors to resistance at 111.85-112.00.  

The 10-year treasury yield continues to recover from over three-month lows below 2.6 percent hit earlier this week. Therefore, the probability of the pair finding acceptance above 111.46 is high.  

It is worth noting that the bounce from 111.00 has established that psychological support as the level to beat for the bears.  

Hourly chart

Trend: Bullish above 111.46