On Thursday, the USD/JPY currency pair raised to the resistance level formed by the weekly R1 at 108.13. During today’s morning, the pair was testing the given resistance.
If the given level does not hold, it is likely that some upside potential could prevail in the market within the following trading session. Note that the exchange rate would have to surpass the Fibonacci 38.20% retracement at 108.44. A possible upside target is the psychological level at 108.60.
If the given resistance level holds, it is likely that the US Dollar could depreciate against the Greenback in the short term. In this case it is unlikely that the pair could drop lower than the support cluster formed by the 55-, 100– and 200-hour SMAs, as well the weekly and monthly PPs in the 107.31/107.61 area.
