Yesterday, the USD/JPY currency pair breached the medium-term descending channel north. During Tuesday morning, the rate tested the resistance level—the weekly R1 at 109.07.
Given that the exchange rate is supported by the 55-, 100– and 200-hour SMAs, it is likely that some upside potential could prevail in the market. In this case the rate could reach the psychological level at 109.20.
However, if the given resistance holds, it is likely that the currency pair could trade sideways within the following trading session. Also, it is unlikely that the pair could drop lower than the weekly PP at 108.67
