USDJPY has been gently trending up since forming a doji candlestick on March 24, with the bulls currently waiting for a break above the 135.30 resistance, which is the 61.8% Fibonacci retracement of the previous downleg, to continue higher.
In momentum indicators, the Stochastics and the RSI are running out of steam, but the indicators are still within the bullish area, while the MACD keeps moving above its red signal line, mirroring a weakening bullish bias overall.
The 200-day simple moving average (SMA) at 133.75 could protect the pair from additional declines, which may reach the important support trendline from January’s lows at 131.80, unless the 38.2% Fibonacci number comes to the rescue beforehand. A bearish trendline breakout may initially stall around 130.60 before stretching towards the January low of 129.63.
On the upside, a decisive close above 135.30 could bolster buying appetite up to the March high of 137.90. Running higher, the price may attempt to reach the 140.00 psychological level.
All in all, although buying interest seems to be fading, USDJPY may not give up the battle with the 135.00 resistance area. A decisive step above it could stage the next bullish wave in the market.
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