USDJPY retains a short-term neutral stance on the daily chart, confirmed by the flat technical indicators. The RSI is neutral, while the 50 and 200-day moving averages are moving sideways. In the bigger picture, the pair has been trading in a range between 108 and 114 since March and is currently located in the upper end of this range.
Additional gains are possible since the market is above the two moving averages and RSI is above 50. A pick up in upside momentum would help push prices to the top of the range at 114 and re-test the prior high at 114.73. These two levels are creating a strong resistance zone, which if broken would shift the overall bias to bullish and likely propel USDJPY towards the 115 handle.
Failure to rise above 114 in the short-term could see prices slip down towards 113 and 112.97, which is an area of support around the 50-day MA. A decline from here would shift focus to the 200-day MA and the bottom of the long-term range at 111.
The near-term bias is expected to remain neutral around the 50-day MA. USDJPY is likely going to continue to trade sideways between 112 and 114 for now. There is no change to the medium-term neutral outlook.
