USDJPY resumes broader bullish momentum after a shallow pullback

USDJPY advanced on Thursday after the recent pullback from a new multi-week high at 157.96 (Mar 3) was contained by the rising 10DMA at 156.34.

Price action on Thursday has so far formed a Hammer candle on the daily chart, suggesting a possible end to the shallow corrective phase from 157.96 to 156.44.

The broader technical structure remains firmly bullish on the daily timeframe, underpinned by strong positive momentum and multiple bullish crossovers of daily moving averages, which remain in a positive configuration. These signals support expectations for continuation of the upleg from 152.26 (Feb 12 low) after the pair cleared the key barrier at 157.65, the former Feb 9 high.

Fundamentally, the dollar continues to draw support from rising safe-haven demand and fading expectations of near-term Federal Reserve rate cuts, as escalating geopolitical tensions raise concerns about renewed inflationary pressures.

Bulls are now looking for a retest and decisive break above Tuesday’s peak at 157.96, which would confirm a fresh bullish signal and validate a double-bottom formation at 152.11/26, opening the way toward targets at 159.22 and 159.45, the highs from Jan 23 and Jan 14.

Initial support is located at 156.62/34 (Fibo 23.6% retracement of the 152.26/157.96 rally and the 10DMA), followed by 155.98 (daily Tenkan-sen). A stronger support zone stands at 155.79 (Fibo 38.2% retracement and the top of the thin daily cloud), which is expected to contain deeper pullbacks and keep the broader bullish outlook intact.

Res: 157.65; 157.89; 158. 90; 159.22
Sup: 156.62; 156.34; 155.98; 155.79