• USD/JPY extends the previous session’s gains on Tuesday in the European session.
• The ascending trendline from the lows of 109.21 acts as a defensive for the bulls.
• The Momentum oscillator holds onto the overbought zone warrants caution for the pair.

USD/JPY picks up the momentum in the European trading hours. The pair opened lower but recovered swiftly to touch intraday high at 113.97, where it currently hovers.

USD/JPY daily chart

On the daily chart, the USD/JPY pair has been riding higher after testing the low of 109.12 on September 22. The pair rallied toward a four-year high at 114.69 on Wednesday. The pair retreated toward the low of 113.45 in a span of three days, before bouncing back to near 114.00.

If the price breaks above 114.00 then the USD/JPY bulls could advance toward the 114.50 horizontal resistance level. Further, a daily close above the mentioned level could bring March, 2017 highs of 115.50 back into the picture.

Alternatively, a decisive break of the ascending trendline from the lows of 109.12, would seek the 113.50 horizontal support level, followed by the low made on October, 12 at 113.00. Any downtick in the overbought Moving Average Convergence Divergence (MACD) could bring more selling opportunities toward the 112.50 horizontal support level.

USD/JPY additional levels