USD/JPY: bulls cleared the way up
USD/JPY recovered to 101.60 after having dipped to 101.20 earlier in the day. Yesterday the yen touched 102.15 (weakest since October 2008) as the US economy showed continued signs of recovery and Treasury yields touched a seven-week high.
As can be seen from the chart, USD/JPY has recently broken out of the ascending triangle, what is a strong bullish sign. Cheered up by the G7 meeting, Yen bulls managed to overcome the 100.00 resistance after several months of hesitation. Our next medium-term bullish target is seen at 103.35 (200-week EMA) and at 105.40 (61.8% Fibo).
However, there is enough room for pullbacks. We recommend using them as buying opportunities. On a daily chart one may see a MACD divergence, the pair is overbought. The pair is forming a model, resembling an “evening star”. However, the 100.00 level is expected to work as strong support for the market.
Chart. Daily USD/JPY.