The Dollar/Yen closed relatively unchanged yesterday as lack of macroeconomic data failed to trigger any major speculative interest. The Nikkei posted a modest intraday advance, while US indices recovered from early lows, which also failed to stimulate action in USD/JPY. The upcoming session will remain quiet in terms of data, but the overall sentiment remains bullish and if equities decide to take off, the pair will most probably follow suit.
The Dollar/Yen pulled back to retest the broken neckline as expected and bounced as the bulls showed up just in time to keep this inverted H&S pattern valid. However, the bulls are facing a major hurdle as 112 (R1) being a major resistance and 112.30 (R2) being a multi-year trend line resistance. Only a successful break above those two levels can confirm much higher prices on this pair.
Support: 111.50 / 111.25
Resistance: 112 / 112.30