In line with expectations, the US Dollar surged against the Yen on Monday, resulting in a 117-pip appreciation within one day. The pair crossed several resistance levels, including the 200-hour SMA at 109.30, and has since showed lack of volatility during this morning. This minor consolidation phase might suggest that bulls have exhausted their upward force and thus give the dominant hand to bears instead.
The upside is guarded by the monthly PP and the upper boundary of a channel down circa 109.80—a level that might be a turning point for the rate. Subsequent direction is expected to be to the downside.
In case no massive events shake the market, the rate might continue its movement sideways for several hours before dashing towards the 100-hour SMA at 108.60.
