The USD/JPY exchange rate was tended north on Monday but wit no large gains apparent during this session. By Tuesday morning, the pair was located at a one-week channel slightly below the 110.00 mark.
If looking on the 4H chart, the pair surpassed the 100-period SMA—a move which might be interpreted as a bullish sign. This means that the US Dollar could breach the nearby weekly R1 and 61.80% Fibonacci retracement at 110.20 and continue its upward movement until the monthly R1 and the weekly R2 at 110.80.
In terms of downside potential, the 55-hour SMA could provide strong support at 109.60 and thus guide the pair back north. Meanwhile, it is unlikely that the 200– and 100-hour SMAs and the weekly PP at 109.20 are breached.
