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Forex: Now that the USD/JPY is kissing the 100.00... What's next?

FXstreet.com (San Francisco) - After rising 725 pips in the last 6 sessions from the April 4th low at 92.70, the USD/JPY is just flirting with the famous 100.00 level. With the pair consolidating 4-year highs just below the mentioned level, market isn't asking now if the pair will broke that level, but what will happen once the mark has been surpassed.

"The break through 100 was never expected to be an easy battle but when the barrier is clear," commented BK Asset Management analyst Kathy Lien, "there could be a surge upwards." If investors check the chart, most important resistance levels above here is the November 2008 high at 100.55 and the April 2009 high at 101.43.

As for the short term, USD/JPY is trading 0.10% below Thursday opening price at 99.70. Despite that, pair is slightly bullish according to the FXstreet.com trend index. Indicators such as CCI, Momentum and MACD are bullish while the Stochastic is bearish in the 1-hour chart. "100 SMA offers short term support around 99.00," points FXstreet.com analyst Valeria Bednarik. "Once below, corrective movement could extend down to 98.40, where strong buying interest has been reported over the last few days."

In this line, Scotiabank states that the USD/JPY remains technically bullish. "Looking to USD/JPY they are also bullish and note that all signals are in buy territory. With RSI at 71, they see further room for a leg higher before moving to overbought territory."

In a wider chart, BTMU analysts believe that the USD/JPY has more space to gain in the incoming months. BTMU expects "the core range of the USD/JPY to move close to the JPY110 level in Q4 2013 and Q1 2014 due to Governor Kuroda’s QQE measures," the bank states.

UBS analyst team also believes in the upside bias for the USD/JPY as they see the pair rising further to 110.00 by the end of 2013 and 120.00 by the end of 2014. Regarding the bank, USD/JPY remains bullish, in spite of critical resistance at the 99.87 level, onto 101.45. However, "the immediate risk should be for a setback to unwind the overextended upside conditions, support is at 98.59 ahead of 97.09."

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