Today we would like to draw your attention to the USD/JPY currency pair. It has been going bullish for some time and we generally predict this momentum will remain unchanged. The pair recently established a new strong support at 112.75, where it became fixed.
The dollar was able to register new gains against the yen largely due to the political instability in Japan, where Prime Minister Shinzo Abe called for preliminary elections a few days ago. This, combined with the perspective of a more hawkish policy in the United States, managed to boost the dollar.
This level of 112.75 serves as a pivot point currently. If the price of the USD/JPY trades above this level, expect further growth. Our likely next stable levels are the nearby resistances at 113.50, 113.74, and even 114.00. If the rate drops below the pivot, then we can talk about decreases. Should the pair start moving down, look for the support levels at 112.50, 112.20, and 111.75.
As of the moment of this article’s publication the USD/JPY pair is trading around 113.09, well above the pivot point. All technical indicators agree on a strong buy right now. The RSI indicator too currently supports a further bullish movement on the USD/JPY. This is why we would recommend opening buy deals, with a T/P order at 113.25 and a stop-loss at around 112.40.
