The USD/JPY currency pair on Friday failed to test the 114.500 level after pulling back later amid weak US consumer sentiment data. The currency pair continues to trade within an ascending channel formation in the 60-min chart.

The pair rallied to multi-year highs of about 114.478, before retreating late on Friday. It remains pinned above the 100-hour moving average, despite pullback back off the overbought conditions of the 14-hour RSI.

USD/JPY Fundamentals Overview

From a fundamental perspective, the USD/JPY currency pair is trading at the back of a relatively busy period in the US market. On Friday, the US retail sales control group for September beat the expected change of 0.4% with a change of 0.8%. On the other hand, general retail sales for the period outperformed the (MoM) expectation of -0.2% with a change of 0.7%.

However, the preliminary Michigan Consumer Sentiment Index for October missed the expectation of 73.1 with 71.4. Earlier in the week, the initial and continuing jobless claims outperformed estimates while the producer price index ex-food and energy fell short of expectations.

In Japan, the tertiary industry index for August missed the expected (MoM) change of 0.0% with a change of -1.7%. The industrial production for August came short of the (YoY) expectation of 9.3% with a change of 8.8%, while capacity utilization missed -0.2% with -3.9%. Elsewhere, machinery orders for August beat the (YoY) expectation of 14.7% with 17%, while the (MoM) equivalent missed 3.1% with -2.4%.

USD/JPY Technical Analysis (the 60-min Chart)

Technically, the USD/JPY currency pair appears to be trading within an ascending channel formation in the 60-min chart. The pair recently pulled back after finding trendline resistance around 114.478.

Therefore, the bears will be targeting extended pullback profits at around 113.979, or lower at 113.690. On the other hand, the bulls will be looking to ride the current bull run by targeting profits at about 114.478 or higher at 114.765.

USD/JPY Technical Analysis (the Daily Chart)

In the daily chart, the USD/JPY currency pair appears to be trading within a sharply ascending channel formation. The pair has now rallied into overbought conditions of the 14-day RSI. This indicates a strong long-term bullish bias in the market sentiment.

Therefore, the bulls will be looking to stretch the current bull-run towards 115.339 or higher to 116.508. On the other hand, the bears will target long-term profits at about 113.204 or lower at 112.037.