The US Dollar’s movement against the Yen was bounded between the 100– and 200-hour SMAs on Tuesday. Some additional volatility was introduced during the second half of the day; however, the pair lacked enough force to dash through any of these two barriers.
The pair is trading near a medium-term channel located at 105.80. It is expected that this pattern is eventually breached to the upside, thus paving the way for a surge during the following weeks.
In the short term, it is likely that the pair continues trading within the same range until the US GDP data release at 1230GMT provides the necessary momentum for a breakout.
Technical indicators favour bearish correction in this session. Apart from the 105.40 area, no additional support levels are restricting the pair until its 2017/2018 low of 104.67.
