USDJPY ticked to a fresh 4½-year high of 115.22 early on Wednesday before easing slightly below the 115.00 level again.
Previously, the price strengthened its bullish bias by bouncing forcefully near the 114.00 number and the 20-day simple moving average (SMA). Currently, the RSI is losing some momentum, indicating weakening buying pressures, though as long as it remains above its 50 neutral mark, the bulls may have new opportunities to drive the market higher. Note that the red Tenkan-sen line keeps pointing upwards above the blue Kijun-sen line, while the positive trajectory in the MACD is another encouraging sign that bullish forces may re-emerge in the short term.
However, the 115.50 area could prove to be a hurdle on the way up. This is where the pair stalled in early 2017, while the presence of the support-turned-resistance trendline is adding more importance to the region, increasing the case for a sharp rally towards the next barrier of 117.00 if the bulls indeed breach the wall around 115.50.
Otherwise, should sellers dominate, the red Tenkan-sen line and the 20-day SMA could immediately support the market within the 114.45 – 114.00 zone. If not, the decline could extend towards the 50-day SMA and the previous low of 112.71. Any close lower from here would put September’s upleg into question, downgrading the short-term outlook to neutral.
In brief, USDJPY seems to have more bullish fuel in the tank, though whether this will be enough to overcome the 115.50 bar remains to be seen.