USDJPY is trending higher on its 4-hour time frame and looks due for a pullback to the support zone. Applying the Fibonacci retracement tool shows other levels where buyers might be hoping to join in the uptrend.

The 61.8% level is closest to the trend line support around 104.12, which is also around an area of interest or former resistance. A shallow pullback could find buyers at the 50% Fib at 104.30 or the 38.2% level near the 104.50 minor psychological mark.

The 100 SMA is above the 200 SMA to indicate that the path of least resistance is to the upside. In other words, the climb is more likely to gain traction than to reverse. The gap between the indicators is also widening to reflect strengthening bullish pressure. These moving averages are near the trend line to add to its strength as support as well.

Stochastic has been indicating overbought conditions for quite some time, so buyers could use a break and allow sellers to take over. Similarly RSI has been in the overbought region for the past few days, so a correction is due. Both oscillators have plenty of room to move south before indicating oversold conditions or exhaustion among sellers.

There are no major reports from the Japanese economy this week, so USDJPY price action could hinge mostly on dollar movements and overall market sentiment.

The US has its NFP report coming up on Friday, so leading indicators due in the next few days could determine where the US currency is headed. Strong readings could pave the way for an early rally while weak figures could lead traders to price in downbeat jobs expectations.

Apart from that, the vaccine rollout is likely to impact market sentiment, along with stock market volatility. Recall that last week’s GameStop news sparked some risk-off flows as traders grew wary of a market crash.