USD/JPY erases losses and rises back above 112.00

By FXStreet USD/JPY gained momentum during the American session amid a stronger US dollar in the market. The pair broke a short-term trading range between 111.55 and 111.80 and climbed above 112.00.

Recently it peaked at 112.03 and it was trading at 112.00, around the same level it closed yesterday. Earlier it bottomed at 111.36 but it has been able to erase all losses.

USD/JPY levels to watch

The pair still holds a bullish tone in the very short-term as it attempts to extend the recovery from 1-year lows that reached last week. So far it has been unable to consolidate above 112.00. Above the next key resistance is seen around 114.00: a consolidation on top could open the doors for further gains.

According to analysts from Societe Generale, the monthly shows a “head and shoulders” formation with a potential target at 106, but in the short-term they look at 110 – 111 as a strong support, noting also that the neckline around 116 should cap the upside.

Price action could be limited during the current week as low volume is expected taking into account that during Thursday and Friday many markets around the world are going to be close.
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Source:: FX Street