USD/JPY: bulls in charge, but fragile above the descending channel's resistance, need a firm close above R1

• USD/JPY is just about holding in bullish territory above the descending channel's resistance line. 
• USD/JPY rallied on the FOMC minutes, extending a pre-event bid as the market starts to come to terms with higher rates. 

USD/JPY rallied on a mix of better performing EM-FX, US stocks, Diminishing market expectations for BOJ normalization and 10-year yields getting up into the 3.20's%.  the pair traded to 112.38 before the FOMC minutes and then into the 112.60's for a 112.69 NY session closing high. 

The FOMC minutes was originally digested as not containing anything particularly new, although at a second glance and further scrutiny, the markets picked up on the hawkishness in the  par that read, " A few participants expected that policy would need to become modestly restrictive for a time and a number judged that it would be necessary to temporarily raise the federal funds rate above their assessments of its longer-run level.”

FOMC minutes: Some members see the need for raising rates above neutral

A few reasons to get long USD/JPY

Analysts at Nomura came with a number of reasons for why USD/JPY can run higher as follows:

Diminishing market expectations for BOJ normalization;
Resilient US data, while US yields are becoming more sensitive to data surprises;
Reduced political uncertainty in Japan, and; 
A more USD/JPY positive supply-demand situation, as the trade balance has deteriorated while Japanese residents’ foreign investment has remained strong. We expect USD/JPY to overshoot to above 120 until next summer, before retracing from Q4 2019 onwards."

USD/JPY levels

• Support levels: 112.20 111.90 111.50    
• Resistance levels: 112.60 113.00 113.45

Valeria Bednarik, chief analyst at FXStreet argued that, technically, the pair seems poised to extend its advance:

"... now challenging the 200 SMA in the 4 hours chart after being unable to surpass it ever since the week started, and technical indicators in the mentioned chart heading sharply higher, both in positive ground. The pair would need to surpass now the 112.60 static resistance level to be able to extend its advance during the upcoming sessions."