USD/JPY was trading in a neat channel down for last two sessions. Following a test of the more senior channel and the 55-period (4H) SMA mid-Friday, strong upside risks pushed the rate out of this short-term channel and towards the 109.80 mark where the 100-hour and 100-period (4H) SMAs are located. These moving averages might work as strong resistance, thus reversing the rate back down to the 200-hour SMA and the monthly PP at 109.40.
From technical point of view, the pair should continue its current up-move and target the upper channel line, the monthly R1 and the weekly R2 at 110.75 this week. Technical indicators are also bullish for this session, suggesting that the 109.80 level should eventually surrender.
