USDJPY edges higher within multi-month-old bullish channel
USDJPY defends a two-week uptrend within an ascending trend channel established since early March. In doing so, the Yen pair stays near an upper limit of the stated channel, recently wobbling between the 21-day SMA and a one-month-long resistance line. It’s worth noting that the RSI (14) line suggests the bullish exhaustion while the MACD also lacks directional momentum and hence a pullback towards the 21-day SMA level of around 146.55 appears imminent. Adding strength to the stated SMA support is the 78.6% Fibonacci retracement of the October 2022 to January 2023 downturn. In a case where the Yen pair drops below 146.55, July’s peak of 144.90 and the 61.8% Fibonacci retracement level of 142.55 can test the bears before allowing them to challenge the key supports, namely the 100-day SMA and the aforementioned channel’s bottom line which are around 141.80 and 141.40 respectively.
Meanwhile, an ascending trend line from mid-August, close to 148.80, guards immediate recovery of the USDJPY pair ahead of the bullish channel’s top line, close to 149.80 at the latest. Following that, the 150.00 psychological magnet and 150.30 levels may test the Yen pair buyers. In a case where the risk-barometer pair stays firmer past 150.30, the odds of witnessing a run-up towards challenging the previous yearly peak of around 152.00 can’t be ruled out.
To sum up, USDJPY buyers keep the reins at the start of the Fed week, even as Japan’s national holiday and sluggish upside momentum prod the bulls of late.
