Last week USD/JPY broke over the resistance of 77.40. The pair went as high as 77.80 and went into into a sideways mode. The weekly close was at 77.62.
The strong upward move suggests that we can expect some more upward gains but we will be careful as overall the currency pair stays in the sideways mode. Also as we had mentioned during last weekend that the upward jump was expected because of the approaching psychological level of 75.00 ranges.
On the upside, above 77.80 we will expect a move towards 78.28 and only a firm break above that will make us expect some more convincing upward gains towards 79.54 or the high of October 31st, 2011. A failure of the break above 77.80 and then 78.28 should take USD/JPY back towards 77.10 and a break below 77.00 will change our focus back towards downside towards the support levels of 76.40 then 76.20 and then 76.00.
Please note that we do not expect much directional move from USDJPY before the currency pair breaks the psychological resistance and support levels of 80.00 and 75.00 respectively.
You may also check the weekly usdjpy forecast/Outlook and daily usd/jpy analysis at ForexAbode.