USD/JPY: uncertainty diminishing, upside favourable?

Currently, USD/JPY is trading at 104.24, up 0.43% on the day, having posted a daily high at 104.33 and low at 103.72.

USD/JPY is in a consolidative phase on the daily sticks and has been since the start of October. The uncertainty in the markets had been favourable to the Yen bulls, but that seems to be clearing up a little and there is a resurgence in the greenback again, with the DXY rallying to fresh highs through the key 98.80 resistance recently. Oil has also taken a knock and that is supportive of a rebound in the dollar, supporting a better bid USD/JPY in the US session today.

The Presidential elections and Brexit have been the underlying concerns in the market of late, but both of these are looking less problematic for the meantime and with China stabilizing, markets are focussing back to whether the Fed will be hiking in December after a Clinton victory, with the majority favouring such an outcome in both respects, underpinning stocks and the greenback. 

USD/JPY levels

"USDJPY is breaking through short-term (intraday, daily) “cloud” chart resistance as the market retests the recent range highs above 104. Consecutive rejections of the 99.95/100 through the mid year period suggest that if the USD can extend gains through the low/mid 104 range, a deeper rebound in the USD towards 108.00/50 may follow,"  - Scotiabank.

Meanwhile, with spot trading at 104.25, we can see next resistance ahead at 104.33 (Daily High), 104.40 (Weekly Classic R1), 104.55 (Daily Classic R2), 104.88 (Daily Classic R3) and 105.00 (Weekly Classic R2). Support below can be found at 104.22 (Yesterday's High), 104.20 (Monthly High), 104.18 (Daily Classic R1), 104.05 (Hourly 20 EMA) and 103.95 (Weekly High).