USD/JPY Price Analysis: Bulls challenge symmetrical triangle resistance

USD/JPY added to its recent positive move and gained traction for the third straight session.
The formation of a bullish pennant on the daily chart supports prospects for further gains.
Only a sustained break below the 109.40-35 region will negate the near-term positive bias.

Haresh Menghani FXStreet

The USD/JPY pair edged higher for the third consecutive session on Tuesday and climbed to one-and-half-week tops, around the 110.15 region during the first half of the European session.

The USD/JPY pair was last seen hovering near a resistance marked by a downward sloping trend-line, extending from YTD tops touched in March. This, along with another ascending trend-line, constitutes the formation of a symmetrical triangle on the daily chart.

Given the strong positive move from YTD lows, or sub-103.00 levels touched in January, the mentioned triangle might be categorized as a bullish continuation pennant chart pattern. A sustained move beyond will set the stage for an extension of the near-term appreciating move.

The constructive setup is reinforced by the fact that oscillators on the daily chart have just started gaining positive traction. A subsequent move beyond monthly swing highs, around the 110.30-35 region will reaffirm the bullish breakout and prompt some technical buying.

The USD/JPY pair might then aim to retest YTD tops, around the 111.00 neighbourhood. The momentum could further get extended towards the next relevant hurdle near the 111.50-55 region, though bulls might be reluctant to place aggressive bets ahead of the FOMC.

On the flip side, the 109.70-65 horizontal zone now seems to protect the immediate downside ahead of the triangle support, currently near the 109.40-35 region. Sustained weakness below will negate any near-term positive bias and turn the USD/JPY pair vulnerable.

The next relevant support is pegged near the 109.00 round figure, below which the USD/JPY pair could extend the corrective slide further towards the 108.70-60 support zone.

USD/JPY daily chart

Technical levels to watch

USD/JPY

Overview
Today last price	110.05
Today Daily Change	-0.01
Today Daily Change %	-0.01
Today daily open	110.06

Trends
Daily SMA20	109.4
Daily SMA50	109.12
Daily SMA100	108.12
Daily SMA200	106.3

Levels
Previous Daily High	110.1
Previous Daily Low	109.61
Previous Weekly High	109.84
Previous Weekly Low	109.19
Previous Monthly High	110.2
Previous Monthly Low	108.34
Daily Fibonacci 38.2%	109.91
Daily Fibonacci 61.8%	109.8
Daily Pivot Point S1	109.75
Daily Pivot Point S2	109.44
Daily Pivot Point S3	109.26
Daily Pivot Point R1	110.24
Daily Pivot Point R2	110.41
Daily Pivot Point R3	110.73

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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