- Bulls challenge the top end of over one-week-old trading range.
- Sustained move beyond 200-DMA to pave way for further gains.
The USD/JPY pair extended its sideways moves through the mid-European session on Monday and is currently placed at the top end of a broader trading range held over the past one week or so.
Given the recent rebound from multi-year lows and a subsequent breakthrough over five-month-old descending trend-line, the recent price action might still be categorized as bullish consolidation.
Meanwhile, oscillators on hourly/daily charts maintained their bullish bias and add credence to the near-term constructive outlook, supporting prospects for an eventual breakout on the upside.
However, traders are likely to wait for a sustained strength beyond 200-day SMA hurdle, near the 109.00-109.05 region, before positioning for a move towards the key 110.00 psychological mark.
Conversely, any meaningful pullback below the 108.40-35 region – marking 50% Fibonacci level of the 112.40-104.45 downfall – might attract some dip-buying interest and help limit the downside.
The mentioned descending trend-line resistance breakpoint, currently near the 107.80 region, now seems to act as strong support, which if broken might be seen as a key trigger for bearish traders.
USD/JPY daily chart
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