USDJPY is down to the bottom of its ascending channel on the daily chart and might be due for a bounce back to the top. This area lines up with the 61.8% Fibonacci retracement level, which adds to its strength as support.

The 100 SMA is above the longer-term 200 SMA to indicate that the path of least resistance is to the upside. In other words, support is more likely to hold than to break and the uptrend would likely resume. In that case, price could bounce to the channel top or at least the mid-channel area of interest. The swing high might also hold as resistance just past the 114.00 handle.

Stochastic is heading lower to show that sellers have the upper hand, but the oscillator is approaching oversold levels to reflect exhaustion. Turning back up could lead to a return in bullish pressure and support the bounce. RSI is also moving south so bitcoin could follow suit. This one has more room to head lower before oversold conditions are seen, so sellers could stay on for a bit longer.

Dollar weakness has been a big market theme in the past few days, though, as the currency barely took advantage of higher yields and risk aversion. Traders seem to be doubting the effectiveness of Fed action as Trump has repeatedly criticized them for hiking too quickly. Still, traders expect another hike from the US central bank later in the year as data has been mostly upbeat.

Another round of strong reports could confirm that the US economy is doing well despite tightening and trade issues. This could renew demand for the dollar as the US economy continues to outperform the rest. On the flip side, the yen has been mostly reacting to market sentiment these days and a pickup in risk-taking could also force it to return its recent gains.