By Mohammed Isah of fxtechstrategy.com
: The pair violated its Dec. 4 high at 90.77 on Monday. That means a convincing break and hold above the Nov. 4 high of 91.31 is needed to set the stage for further gains.
The pair was testing a high of 91.47 Tuesday, and an eventual break above that level will pave the way for more gains toward 92.31, the Oct. 27 high. After that, it could target 93.85, which is where the channel top is located.
This view is supported by the pair's daily and weekly relative strength indices, which are bullish and pointing higher, suggesting further strength.
Support lies at 90.77, the Dec. 4 high that the pair just violated. Below that, there's support at 88.30, the Dec. 14 low; 88.00, the Oct. 7 low; and 87.35 and 87.10. Still lower are 84.80 and 84.45, the pair's Nov. 26 and July 1995 lows, respectively.
Overall, although the USD-JPY remains biased to the downside within its established weekly falling channel, it is now staging a corrective recovery and is eying 91.31 and higher.
Mohammed Isah is a technical strategist and head of research at FXTechstrategy.com, a technical-research Web site. He has been trading and analyzing the foreign exchange market for the past seven years. He formerly traded stocks before crossing over to the forex market, where he worked for FXInstructor LLC as a technical analyst and head of research before joining FXTechstrategy.com. He has written extensively on the forex market and technical analysis and his articles have been featured in The Technical Analyst Magazine, The Forex Journal Magazine, The International Business Times and FXstreet.com. At FXTechstrategy.com, he writes daily, weekly and long-term technical commentaries on currencies and commodities, which are offered to its clients. He also produces
for his subscribers. He provides full coverage of the forex market with specific focus on G10 currencies as well as the commodities markets, with focus on five key commodities.