USDJPY continued to rally on Sep 11 for the sixth consecutive session, its longest streak in almost 17 months supported by easing US-China trade tensions. Last week China and the US agreed to begin a new round of trade talks in October.
“President Trump took a modest step Wednesday night to deescalate the trade war with China, saying he would delay until Oct 15 an increase in the tariff rate on $250 billion in Chinese exports.” Washington Post reported.
Since the trade-war turns to a new phase, we have seen the volatility declined; as a result, JPY crosses moving higher, especially AUDJPY and USDJPY. Hopes of a soft deal by US-China is giving a leg up to investor sentiment.

Technically, with the USDJPY rallying further and taking out its 50MA, the bulls do seem to have the upper hand for the short term at least. Further upsides are likely in the near term once the immediate resistance of 108.20 its 100MA coincides with the higher end of the descending channel is taken out. Crucial supports to watch for resumption of weakness are at 107.50 and 107.20 levels.

Earlier we forecast a higher breakout, now raising the cautious mood. 

On the hourly chart, the price has been forming higher highs-higher lows from last Friday.


According to the daily pivot charts, key support level is placed at 107.10 its 50MA, followed by 106.50 its 20MA. If the index remains on the upward trajectory, key resistance levels to watch out for are 108.20 its 100MA and 109.30 August high, coincides with 200MAs.

It is important to always keep in mind the risks involved in trading with leveraged instruments.

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