USDJPY came back swinging from its early-March low, reaching multi-year highs as positive momentum mounts. Moreover, the pair is currently trading way above its 50- and 200-period simple moving averages (SMAs), reinforcing its overall bullish outlook.
Short-term momentum oscillators reflect a mixed picture as the RSI is found above its 70 overbought region, signalling that an imminent pullback is not out of the equation. However, the MACD is found above zero and its red signal line, which could indicate that the positive momentum in the price might be gaining further traction.
The bulls seem to be firmly holding control over the last few sessions. Should they manage to push the price above the 114.87 hurdle, positive momentum could strengthen, opening the door towards the January 2017 high at 118.60. Crossing above the latter could then pave the way towards the 120.00 psychological mark.
On the flip side, if negative forces resurface, immediate support might be found at the 116.34 level, before sellers eye the region which includes the 50-period SMA and the 115.80 barrier. Crossing below this area could turn the fortunes around for the pair, sending the price to test its 200-period SMA currently at 115.35.
In brief, the overall outlook for the pair is bullish despite trading close to its upper Bollinger Band, which raises the immediate risk to the downside. For sentiment to change, sellers would need to drive the price below the 50-period SMA currently at 115.88.
