On Monday, the USD/JPY currency pair breached the short-term descending channel north. During today’s morning, the pair was testing the support formed by the 55-hour SMA at 108.55.
If the given support level holds, it is likely that the currency pair could try to exceed the psychological level at 108.70. On the other hand, the US Dollar could consolidate against the Japanese Yen in the nearest future.
However, note that the exchange rate is pressured by the 100-hour SMA. Therefore, if the given support level does not hold, some downside potential could prevail. In this case, the rate could face support of the Fibo 38.20% and the 200-hour SMA at 108.44.
