USD/JPY technical analysis: Off lows, looks north with falling channel breakout

USD/JPY's daily chart shows a falling channel breakout.
The short-term moving averages are biased bullish.

Omkar Godbole FXStreet Contributor

USD/JPY is currently trading largely unchanged on the day at 108.41, having hit a low of 108.27 earlier today.

The spot could continue to gain altitude during the day ahead as technical charts indicate the path of least resistance is to the higher side.

To start with, the pair closed 108.44 on Monday, confirming an upside break of a two-month-long falling channel.

Further, the 14-day relative strength index is now teasing a break above 50.00 (in bullish territory) and the 5- and 10-day moving averages (MAs) have produced a bullish crossover.

As a result, the immediate resistance at 108.80 (June 11 high) could soon come into play. A violation there would further validate the bullish breakout and open the doors to the 50-day MA, currently at 109.31.

A daily close below 108.10 (Monday's low) would weaken the bullish case.

Daily chart

Trend: Bullish

Pivot points

1. R3 109.05
2. R2 108.79
3. R1 108.61
PP 108.36
1. S1 108.18
2. S2 107.93
3. S3 107.75

Author

Omkar Godbole

FXStreet Contributor

Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.

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