- Bets are turning towards the greenback bulls as the pair has not accelerated in the recent DXY’s correction.
- The 50 and 200-EMAs continue to march north, which adds to the upside filters.
- The RSI (14) is still serving the 40.00-60.00 range that advocates consolidation.
The USD/JPY pair is displaying a slowdown in the upside momentum after reaching around 144.80 in the Tokyo session. Earlier, the asset rebounded firmly after dropping to near 144.30. Broadly, the major is displaying topsy-turvy moves as investors are awaiting a potential trigger for informed action.
On a four-hour scale, the major is auctioning in an inventory adjustment process, which indicates a tad longer consolidation period. It is critical to state that the adjustment process is an accumulation or distribution by institutional investors.
This week, the US dollar index (DXY) witnessed an intense sell-off while risk-perceived currencies were having a ball. However, the USD/JPY pair didn’t display any weakness and remained firmer. It indicates that the yen bulls are extremely fragile against the greenback bulls and even a decent pullback move ahead will deliver an upside break of the inventory adjustment process.
The 50-and 200-Exponential Moving Averages (EMAs) at 144.00 and 141.40 respectively are advancing higher, which signifies that the upside bias is intact.
While, the Relative Strength Index (RSI) (14) is oscillating in a 40.00-60.00 range, which indicates a consolidation ahead.
The greenback bulls could drive the asset higher after overstepping the previous week’s high at 145.90, which will drive the asset towards the August 1998 high at 147.67. A breach of the latter will send the major towards the psychological resistance of 150.00.
For a decisive bearish reversal, the asset is required to drop below the previous week’s low at 140.35. An occurrence of the same will drag the asset towards the August 30 low at 138.05 followed by the August 23 low at 135.81.
USD/JPY four-hour chart
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