USD/JPY Rallied Above 134.00 And Crossed The 200-DMA
The USD/JPY has finally crossed 134.00 after rallying for more than 100 pips. In fact, the Dollar-Yen pair also crossed the 200 EMA on the daily chart, which was present near 133.70.
For the short-term, this means USD/JPY is now bullish, and the close above the 200 EMA daily means the long-term trend is also about to turn bullish. Although the 200 DMA is pierced already, it would be wise to wait for a few more closes above the 200 EMA to confirm the bullish bias.
On the daily chart, the next important resistance is located at 134.77, which is also the year-to-date of the USD/JPY. According to experts, bulls will have to cross that level with enough momentum to confirm the trend change.
RSI Shows USD/JPY Bulls Are Gaining Momentum
If we look at the fixed value indicators such as the RoC and RSI, they also point towards bullish momentum. Based on these two indicators, it appears that the USD/JPY might even cross the 135.00 level in the next few days or weeks.
On the 4-hr chart, the USD/JPY is also exhibiting bullish bias after breaking the consolidation range between 131.70 to 133.00.
This tells us that USD/JPY has turned bullish on all major timeframes, and even if we look at USD and JPY fundamentals, it also supports the bullish bias.
So for the short term, we believe this bullish trend will continue, and we could even see the test of various resistance levels. If we get a break of 135.00, the next targets will be 136 and 137.47 (the 19th December high).
And if we look at important daily pivot points, the S1 is located at 131.92. And the S2 for USD/JPY is present at 130.8, while the S3 is at 130.11. On the other side, the R1 on the daily chart is present at 133.74.
Given the current environment of high interest rates in the USA and low rates in Japan, it appears the USD/JPY bullish will continue for some time.