- USD/JPY was up more than 0.60% once it broke above a one-month downtrend line on Thursday.
- The 4 hour chart shows the buyers breaking above the 200 EMA, approaching 136.00.
- If USD/JPY breaks above the 136.00 level, a move towards 137.47 is expected.
The USD/JPY It is advancing strongly in the American session, breaking above its 50 day EMA, aiming to reach the 136.00 figure, amid a mixed market environment, with US equities fluctuating between winners and losers. At the time of writing, USD/JPY is trading at 135.87, above its opening price.
USD/JPY Price Analysis: Technical Outlook
From a daily chart point of view, the USD/JPY has a bullish bias, reinforced by the buyers recovering the 50-day EMA at 135.40, while the Relative Strength Index (RSI) approaches its reading of 60, with plenty of room to spare, suggesting a 136.00 assault is on the cards.
Notably, USD/JPY broke above a one-month-old descending resistance trendline on Wednesday, indicating that buyers are in command.
Therefore, the first supply zone for USD/JPY will be the 136.00 mark. Once broken, the next resistance would be the 137.00 figure, followed by the daily high of July 27 at 137.42.
In the short term, on the 4-hour timeframe, the chart illustrates USD/JPY with a bullish bias. Buyers have broken through the 200 EMA hurdle at 135.50, compounding a 30+ pip jump to USD/JPY daily highs at 135.89. Once the majors break above the 136.00 figure, a rally to 137.46 is imminent, with no supply zones on its way north.
USD/JPY 4-hour chart
Key USD/JPY Technical Levels
Source: Fx Street
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