The USDJPY was testing the psychological 120.00 level in Tuesday’s morning session, as the US dollar strengthened following a weekend rate cut by the People’s Bank of China.
The USDJPY has made several attempts at 120.00 over the past two months, having been sent back each time. The pair climbed to a high of 120.14 on Monday. It consolidated at 120.13 ahead of Tuesday’s Tokyo session. The pair faces immediate support at 119.48. It is currently testing the 120.15 technical resistance. A break above that level would lead to 120.53.
The USDJPY is poised to break higher, according to the hourly chart. The bulls are expected to drive the market over the long-term, given Japan’s dismal inflation outlook.