The USD/JPY currency pair pulled back on late on Friday (North American session) to trade at 107.932 after peaking to top 108.180 earlier in the day. The currency pair’s late pullback trimmed a chunk of the weekly gains that came following a steady mid-week rally.

The currency pair had plunged earlier in the week to bottom at around 107.960 before making the u-turn on Tuesday, after which gains followed through Thursday before pulling back on Friday afternoon.

USD/JPY Fundamentals Overview

From a fundamental perspective, the USD/JPY is trading at the back of a busy week in both the Japanese and the US markets. On Tuesday, Japan’s leading economic index beat expectations of 93.6 pints with 93.7 points while the coincidence index missed with 99.7 versus 99.8.

And on Thursday’ Tokyo CPI ex Fresh Food missed with 0.5% versus 0.6% while CPI ex-Food and Energy was also shy of the expectation of 0.7% after posting a year-over-year change for September of 0.6%. The Tokyo CPI missed massively with a 0.4% change versus 0.8% expected for the same period (YoY).

In the US, Durable Goods Orders (DGO) beat with 0.2% versus -0.1% on Friday. DGO ex-Transportation also beat the expectation of 0.2% with 0.5% for August. However, DGO ex-Defense missed massively with -0.6% versus an expectation of 0.1%.

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

Technically, the USD/JPY currency pair appears to have recently turned a corner following a short period of bearish pressure. The currency pair now appears to be enjoying a short-term bullish sentiment despite today’s late pullback.

Therefore, the bulls will be targeting profits at around 108.195 pr higher at 108.422 going into next week. On the other hand, the bears will hope that the bullish momentum dissipates soon for the pair to resume the initial trend. They could be targeting profits at around 107.788 or lower at 107.559.

USD/JPY Technical Analysis (the Daily Chart)

In the daily chart, the USD/JPY currency pair appears to have recently broken out of the sharply diving channel. The recent bullish breakout takes the pair out of a long period of bearish pressure that extends nearly five months.

This gives the bulls a call for optimism. Therefore, they will be targeting long-term profits at around 108.422, 108.999, 109.926 or higher at 111.059. On the other hand, the bears will hope that the pair can drop back to the diving channel. They will target long-term profits at around 107.477, 106.937, 106.050 or lower at 105.196 going into next week.

In summary, the USD/JPY currency pair appears to have recently turned a corner after a long period of bearish pressure. This could signal a major change in market sentiment.