USD/JPY has been riding the tiger in recent weeks: climbing off 108.80 all the way to 114.50 at a fast clip. The 600+ pip move higher took less than a month.
On its way, the pair made symbolic drops to mark a line of uptrend support, which was quite steep. The momentum was strong enough to allow for a small break above the May high of 114.37 but the pair didn’t go too far.
And what cannot go up, must go down. At first, the troubles of Trump Junior halted the pair’s ascent. The smoking gun of collaborating with Russia took their toll: the dollar lost ground across the board.
Then came Yellen’s cautious testimony by Fed Chair Janet Yellen. She expressed some concern about inflation, although sounded more optimistic about the factors, which remain transitory in her opinion.
Dollar mostly weak against the yen
The dollar lost ground across the board, but then recovered against most currencies, with EUR/USD even pressured lower.
But not against the Japanese yen.
USD/JPY is hardly holding onto 113 and seems to lose the steep uptrend support line. Is this the bearish sign marking a big downfall?
If so, support awaits at 112.75, followed by 112.20 and more importantly, 111.80.
The break still needs to be confirmed. Here is the chart:
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