Bulls guided USD/JPY during the first part of Monday, thus pushing the Greenback 43 pips higher against the Yen. This slight advantage was lost later in the day, following a bearish reversal from the 111.40 mark.
Due to this move, the pair failed to reach the upper boundary of a four-week channel up and subsequently fell below the junior pattern and the 55-hour SMA early today. From the theoretical perspective, a decline should follow.
A breakout of the 100-hour SMA and the monthly R1 at 110.70 would send the pair towards its next target of the 200-hour SMA, the weekly PP and the senior channel line at 110.20. In case the 110.70 area remains intact, the US Dollar should continue approaching the senior channel and the monthly R2 at 112.00 during the following days.
