USD/JPY broke above 2015’s falling trendline this week signaling a possible shift back into its prevailing trend. Now it is in a pullback. Let’s assess the technical developments.
After the break above a falling trendline, USD/JPY failed to extend above the next barrier around 119 and thus held under the 200-, and 100-period SMAs. This does not completely invalidate the bullish breakout, and if price can hold above 117 and return above 118, the pressure will be back to 119, with the 120 level as the next key challenge for the bullish outlook.
If USD/JPY breaks below 117, the previous breakout is likely false, and pressure will be back to the 115.85-116 low on the year, as well as the 115.65 December-low.
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