On Thursday, the USD/JPY currency pair pulled back from the session highs of about 155.97 to trade at about 155.57. The currency pair trades within an ascending channel formation in the 60-minute chart.

The pair continues to trade slightly above the 100-hour moving average line, despite the pullback. Thursday’s pullback prevented the currency pair from advancing into the overbought levels of the 14-hour RSI.

USD/JPY Fundamentals Overview

From a fundamental perspective, the USD/JPY currency pair trades during a relatively busy period in both markets. In Japan, exports for November outperformed the expected (YoY) change of 4.8%, with a change of 6.1%. On the other hand, imports for the period missed the forecast of 2.5%, with a change of 1.3% (YoY). The Merchandise Trade Balance for the month came in higher than expected, with 322.2 billion yen versus a forecast of 71.2 billion yen. 

Earlier in the week, the Tankan All Industry Capex for Q4 beat 12%, with a change of 12.6%. The Tankan Large Manufacturing Outlook for the period also outshone 13, with a reading of 15, up from 12. The Tankan Large Manufacturing Index was in line with the forecast of 15, up from 14.

In the U.S., the consumer price index for November missed the forecasted (YoY) change of 3.1%, with a change of 2.7%. The consumer price index ex-food and energy for the period also fell short of 3%, with a change of 2.6% (YoY). On the other hand, the initial jobless claims for last week came in better than expected, with 224k versus a forecast of 225k, down from the preceding week’s 237k.

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

Technically, the USD/JPY currency pair trades within an ascending channel formation in the 60-minute chart. However, the 14-hour RSI has recently pulled back to avoid entering overbought conditions.

Therefore, the bears will look to extend the current pullback towards 155.17 or lower to 154.80. On the other hand, the bulls will look to pounce on profits at about 155.97 or higher at 156.38.

USD/JPY Technical Analysis (the Daily Chart)

In the daily chart, the USD/JPY currency pair has recently completed a downward breakout from an ascending channel formation. However, the 14-day RSI has pulled back to avoid rallying into overbought conditions.

Therefore, the bears will look to extend the latest pullback towards 153.19 or lower to 150.89. On the other hand, the bulls will look to pounce on profits at about 157.78 or higher at 159.98.