USD/JPY Price Analysis: Marches firmly towards 137.50 after printing a five-week high

• USD/JPY buyers reclaimed the 137.00 figure and prepared to assault 138.87, ahead of the YTD high.
• The 4-hour chart suggests the USD/JPY might dip towards 135.58, before continuing its uptrend.

The USD/JPY advances sharply during the day, above its opening price, after hitting a daily high at 13.7.65, but late as there is one hour left for the Wall Street close, the major surrendered some of its gains amidst a risk-off trading session on Monday. At the time of writing, the USD/JPY is trading at 137.50, up by 0.47%.

USD/JPY Price Analysis: Technical outlook

The USD/JPY is upward biased, shifting from neutral after the pair dipped towards 130.39 on August 2. Nevertheless, that’s been the lowest the pair has traded since three months ago, and when it broke a downslope trendline on August 17, it shifted from neutral bias to upward biased.

That said, the USD/JPY is trading nearby the July 27 daily highs at 137.65, which, once cleared, will send the major rallying towards the July 21 swing high at 138.87, followed by the YTD high at 139.38.

In the four-hour time frame, the USD/JPY faces sold resistance at the R1 daily pivot, which is also the confluence of the July 27 daily high at 137.46. It’s worth nothing that the Relative Strength Index (RSI) is entering overbought conditions. Therefore, the USD/JPY might register a leg-down before continuing upwards.

If that scenario plays out, the USD/JPY first support will be the 20-EMA at 136.25, followed by the confluence of the 200-EMA and the August 7 daily high at 135.58.

USD/JPY 4-Hour chart

USD/JPY Key Technical Levels