USDJPY has been in the green for almost a week, aiming to resume its 2023 uptrend above the key 137.50-138.00 resistance territory.
The technical picture suggests there is more room for improvement. The exponential moving averages (EMAs) remain positively aligned, with the price trading above those lines. Moreover, the RSI and the MACD are sloping upwards in the bullish area, reflecting a bullish bias too.
The stochastic oscillator, though, is already in the overbought region. Therefore, some caution might be necessary as the price is trading near the 38.2% Fibonacci retracement of the 151.93-127.21 downtrend at 136.65. A decisive close above that number could bring the 137.50-138.00 ceiling under examination. If the bulls successfully breach that wall, the recovery may continue towards the 50% Fibonacci level of 139.55 and the 140.00 psychological mark, where the resistance line from March is placed. Another victory here could see a remarkable rally towards the 142.00 zone.
On the downside, the 20-day EMA and the support trendline at 135.00 could delay an extension towards the 133.80-133.00 region. This is where the 50- and 200-day EMAs and the 23.6% Fibonacci mark are located. Hence, failure to bounce here could prompt a new bearish correction towards the 2023 ascending trendline seen around 131.80.
In summary, USDJPY may keep facing upside pressures in the short-term, though for an outlook improvement, it will need to print a new higher high above the 137.50-138.00 area.
