Holds support against old highs from Dec/Jan
The USDJPY reached a low price of 120.84 in the Asian trading session. That low was just above the support area defined by successive highs going back to December 23, December 29 and January 2nd ( see yellow area in the chart below). That was enough to get the price moving back to the upside.
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The current price is trading more near the high for the day (at 121.61), but it is not racing higher. Looking at the 5 minute chart, if the buyers are to remain in control, the 121.22 to 121.39, is the support area. The 121.22 level represents the 50% retracement of the days trading range. The 121.39 is the 100 bar moving average on the 5 minute chart (blue line in the chart below). I would expect buyers in this area on a corrective move. If the price moves below the low extreme, that would suggest the market is not ready to commit to the upside just yet.
On the topside, a move above the high for the day at 121.61, would next target the channel topside trend line currently at 121.82 (and moving higher). That level also corresponds with the high price going back to December 8,2014. Yesterday, the price was able to move above this high. The price stalled against 122.00 (high reached 122.01).
Overall, the JPY is mixed on the day versus the major currency pairs. It is stronger against the EUR, CHF and NZD but weaker against the USD, GBP, CAD and AUD. The mixed picture along with little on the calendar today, might keep the pair more contained in trading today. So be patient for your trading opportunities. Overall, the bias remains positive/bullish.
