- USD/JPY takes the bids to renew monthly high, up for the fourth consecutive day.
- Clear upside break of 50-DMA, one-month-old horizontal hurdle keeps buyers hopeful.
- RSI conditions signal limited upside room, highlighting seven-week-old horizontal resistance area.
USD/JPY prints a four-day uptrend as it refreshes the monthly peak around 136.40 during early Friday morning in Europe. In doing so, the yen pair justifies the previous day’s upside clearance of the one-month-old horizontal area, as well as the 50-DMA.
In addition to the breakout of previously key hurdles, bullish MACD signals also keep USD/JPY buyers from refreshing the monthly peak. However, the RSI approaches overbought territory and suggests limited room to the north.
As a result, a broad horizontal area comprising multiple levels marked since June 29, between 137.00 and 137.45, becomes should gain the market’s attention.
However, a clear upside break of the 137.45 mark won’t hesitate to refresh the yearly top marked in July around 139.40.
On the contrary, the resistance-turned-support area near 135.60 precedes the 50-DMA support of 135.45 to restrict the short-term USD/JPY downside.
Following that, an upward sloping support line from August 11, close to 134.15, will be in focus.
Should the USD/JPY bears manage to conquer the 134.15 support, the 134.00 round figure may act as a validation point for the south-run targeting the August 11 low near 131.75.
USD/JPY: Daily chart
Trend: Limited upside expected