USD/JPY Price Analysis: Bulls in control above 106.00, move beyond monthly tops awaited


  • USD/JPY continued gaining traction for the third straight session on Thursday.
  • The formation of an ascending channel supports prospects for additional gains.
  • Bulls seem poised to challenge channel resistance near the 106.70-75 region.

The USD/JPY pair built on this week's goodish rebound from sub-105.00 levels and gained traction for the third consecutive session on Thursday. The pair jumped back above the 106.00 round-figure mark and was last seen trading well within the striking distance of monthly tops.

The US Treasury bond yields continued scaling higher following the release of mostly upbeat US macro releases and remained supportive of the strong bid tone surrounding the USD/JPY pair. However, a broad-based US dollar weakness held bulls from placing fresh bets and capped gains.

From a technical perspective, the pair has been trending higher along an upward sloping channel over the past two months or so. The formation points to a well-established short-term bullish trend and supports prospects for a further appreciating move amid fading safe-haven demand.

The constructive outlook is further reinforced by bullish technical indicators on the daily chart. A subsequent strength beyond the 106.20-25 region (monthly tops touched on February 17) will reaffirm the bullish and set the stage for additional near-term gains.

The USD/JPY pair might then aim to challenge the trend-channel hurdle, currently near the 106.70-75 region. Some follow-through buying will be seen as a fresh trigger for bullish traders and push the pair beyond the 107.00 mark, towards the next resistance near mid-107.00s.

On the flip side, the 106.00 round-figure mark now seems to protect the immediate downside. This is followed by the very important 200-day SMA, currently around the 105.40 region ahead of the trend-channel support near the key 105.00 psychological mark.

Failure to defend the mentioned support levels will negate the near-term bullish bias and prompt some aggressive technical selling. The subsequent fall has the potential to drag the USD/JPY pair further below monthly swing lows support, around the 104.40 region.

USD/JPY daily chart

fxsoriginal

Technical levels to watch

USD/JPY

Overview
Today last price 106.12
Today Daily Change 0.25
Today Daily Change % 0.24
Today daily open 105.87
 
Trends
Daily SMA20 105.17
Daily SMA50 104.22
Daily SMA100 104.39
Daily SMA200 105.47
 
Levels
Previous Daily High 106.1
Previous Daily Low 105.19
Previous Weekly High 106.22
Previous Weekly Low 104.92
Previous Monthly High 104.94
Previous Monthly Low 102.59
Daily Fibonacci 38.2% 105.76
Daily Fibonacci 61.8% 105.54
Daily Pivot Point S1 105.34
Daily Pivot Point S2 104.81
Daily Pivot Point S3 104.43
Daily Pivot Point R1 106.25
Daily Pivot Point R2 106.63
Daily Pivot Point R3 107.16

 

 

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