FxWirePro: USD/JPY extends gains ahead of US CPI data, outlook bullish

Chart - Courtesy Trading View 

Spot Analysis:

USD/JPY was trading 0.08% higher on the day at 115.60 at around 05:45 GMT

Previous Week's High/ Low: 115.59/ 114.14

Previous Session's High/ Low: 115.68/ 115.32

Fundamental Overview:

Focus on the US CPI data scheduled later on Thursday for further impetus. A firmer-than-expected reading might trigger a further build-up of hawkish Fed bets.

Technical indicators are turning bullish. Oscillators are bullishly aligned. 5-DMA is on verge of bullish crossover on 20-DMA.

Sino-American tussles escalate, keeping markets risk-off, adding some support to the dollar. Fears of Russia’s invasion of Ukraine also test optimism.

US 10-year T-bond coupons remain muted after easing from 2.5-year high the previous day.

Technical Analysis:

- USD/JPY is extending break above Triangle top

- The pair is extending gains after brief pause in the previous session

- Momentum is strongly bullish, Stochs are at overbought levels, but no signs of reversal seen

- Volatility is high and GMMA indicator shows major and minor trend are bullish on daily and weekly charts

Major Support and Resistance Levels:

Support - 114.93 (21-EMA), Resistance - 116.35 (Yearly high)

Summary: USD/JPY trades with a bullish technical bias. Scope for upside as long as pair holds above daily cloud.