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Technical Analysis – USDJPY restores bullish bias, keeps one eye on 141.00

Technical Analysis – USDJPY restores bullish bias, keeps one eye on 141.00

USDJPY is climbing for a second day, having bounced back quickly from last week’s tumble. The bulls seem determined to have another go at reclaiming the 141.00 handle after the previous rally ran out of steam just shy of the level.

The RSI is inching higher and has yet to reach overbought levels so there is some scope for additional gains in the short term. But the MACD has yet to cross above its signal line and some buyers might prefer to wait until this has been accomplished before stepping in.

Should USDJPY succeed in breaking above 141.00, the 61.8% Fibonacci retracement of the October 2022-January 2023 downtrend at 142.49 would be the next hindrance on the upside. Even higher, the 78.6% Fibonacci of 146.65 would likely be the last obstacle before revisiting the October 2022 high of 151.94.

However, if the 141 resistance is again able to prove unbreakable, the price could pull back towards the 200-day simple moving average (SMA) around 137.28 before retreating further towards the 50-day SMA at 135.46. Steeper declines would turn the attention on the 133.00 level, which lies slightly below the 23.6% Fibonacci. After that, the January trough of 127.21 would re-enter the spotlight.

In brief, USDJPY has positive prospects in the near term and a higher high above 141 would solidify its medium-term uptrend, whereas a drop below its moving averages would revive the negative forces.

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