Source: Forex Analysis
USDJPY maintains a bullish outlook on the daily chart as the price has managed to make another higher high. Besides, the price is also located way above the 61.8% retracement level, signaling a potential upside movement. The JP225 rally has sent the Japanese yen towards new lows versus major currencies. So, if the Nikkei continues its climb, USDJPY could grow in the short term as well.
USDJPY has reached the median line (ML) and the R1 level. So, we cannot exclude a minor decline in the short term from this resistance area, the quote could come back to test and retest the 61.8% retracement level and the sliding line (SL) before it resumes the ascending movement.
The pair is under strong bullish pressure after the false breakdown below the sliding parallel line (SL1) and below S1 level, but we still need a confirmation that the price will reach new highs.
However, the price could breakout above the median line (ML) and above R1 anytime soon. So, a valid breakout above these levels will give us a great chance to go long with the first potential target at the 100% level, R3. The major upside target could be at the upper median line (UML).
A further increase could be invalidated only by several false breakouts, rejections from the median line (ML – orange line) of the ascending pitchfork. Personally, I would like to see a decrease in the short term because a rejection from the 61.8% level and from the sliding line (SL) could signal important bullish momentum.
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