USD/JPY technical analysis: Bulls struggle to make it through 100-period EMA on 4-hourly chart
- The USD/JPY pair continued gaining some positive traction for the third consecutive session on Monday and held steady above mid-106.00s through the early European session.
- The pair, however, struggled to extend the momentum further beyond 100-period EMA on the 4-hourly chart, which should now act as a key pivotal point for short-term traders.
Meanwhile, technical indicators on hourly charts have been gaining positive momentum and recovering from the bearish territory on the daily chart, which supports prospects for an extension of the recent recovery move from the vicinity of the key 105.00 psychological mark or multi-month lows set last week.
A sustained breakthrough the mentioned barrier will reinforce the bullish bias and set the stage for a move beyond the 107.00 handle towards testing the 107.20 region - a resistance marked by 50% Fibo. level of the 109.32-105.05 recent downfall - en-route its next major horizontal resistance near mid-107.000s.
The momentum could further get extended towards 61.8% Fibo. level - around the 107.70-75 region - which if cleared might negate any near-term bearish bias and continue fueling the ongoing short-covering move further towards the 108.00 round figure mark ahead of the 108.45-50 supply zone.
On the flip side, the 106.00 handle - nearing 23.6% Fibo. level - now seems to protect the immediate downside, below which the pair might turn vulnerable and head back towards challenging the 105.00 round figure mark with some intermediate support near the 105.65 region.
USD/JPY 4-hourly chart