USD/JPY Price Analysis: Erases previous-day losses and climbs above 156.00

• USD/JPY climbs and gains 0.79%, supported by strong US economic data.
• Technical outlook shows a bullish harami pattern, indicating potential for further gains.
• Key resistance levels: 156.50, May 30 high at 157.68, and YTD high at 160.32; support at 156.00, 155.00, and confluence of Tenkan-Sen and 50-DMA at 154.81/92.

The USD/JPY recovered some ground and advanced towards the top of the Ichimoku Cloud (Kumo) on Wednesday, gaining some 0.79% and trading at 156.11 at the time of writing. Data from the United States kept the Greenback bid while falling Japanese Government Bond (JGB) yields undermined the Yen.

USD/JPY Price Analysis: Technical outlook

From a technical perspective, the USD/JPY remains upward biased despite retreating toward the 50-day moving average (DMA) at 154.82 on Tuesday. However, buyers lifted the exchange rate towards current levels, forming a ‘bullish harami’ candlestick chart pattern that could open the door for further gains.

Short-term momentum is on the buyers’ side, as depicted by the Relative Strength Index (RSI) standing in bullish territory.

The USD/JPY first resistance would be the 156.50 mark. A breach of the latte will expose the May 30 high of 157.68 before rallying toward the April 26 high of 158.44. Up next would be the year-to-date (YTD) high of 160.32.

On the flip side, the USD/JPY's first support would be 156.00. Once surpassed, the next stop would be 155.00, before testing the confluence of the Tenkan-Sen and the 50-DMA at around 154.81/92.

USD/JPY Price Action – Daily Chart