Breaks above trend line resistance on the daily chart
The USDJPY has pushed above trend line resistance on daily chart today. That occurred at the 102.06 level. The line has three points and two other tests that got close - just not close enough. Regardless, today's break is key for the bulls. It would be better if the range can be further extended. The days range of 104 pips is equal to the average over the last 22 trading days (about a month of trading). We are breaking above the highs as I type. A move above will next target the 102.77 level which was the last two swing highs from September 15 and September 21. Getting above that level will next look toward the 103.35-53 (see yellow area in the chart below).
The USDJPY has been in a relatively narrow trading range over the the last few months as it battled with the idea of going below the parity level. Although there were five days that the price traded below the 100.00 level, there has only been one close below the level. In September, the low could only get 100.08 and 100.07 at the lows.
The consolidation in the pair has helped to bring the 100 day MA closer to the current level. That MA comes in at 103.797. We are getting to within 100 pips of that key MA line. The price for the USDJPY has only closed above the 100 day MA on 2 occasions this year (back at the end of January/ beginning of February). Of course the MA line was much higher at the time (at 120.60 to be exact). The USDJPY has gone a long way since that time - and so has the MA level. There is room to roam if the dollar strength idea starts to take hold - especially a beaten down currency like the USDJPY.
Looking at the 5- minute chart, the move has accelerated above a topside trend line. The pair has also tracked above the 100 bar MA (at 102.47 currently). That MA line (blue line) will be eyed for support now.
