USD/JPY has been trading sideways for two consecutive sessions. This movement does show a slight tendency downwards, guided by the 55-hour SMA. This has allowed the pair to reach the bottom boundary of the senior channel near 110.70.
The US Dollar breached this channel line and the 200-period (4H) SMA early on Thursday—a move which is likely to strengthen bears during the following hours, as some downside potential is still apparent in the market. This fall is unlikely to exceed the combined support of the weekly S2, the monthly PP and the 61.80% Fibonacci retracement at 110.25.
Given the strong resistance levels located nearby, it is unlikely that bulls gather enough momentum to overcome the 55– and 100-hour SMAs at 111.25.
