New highs for the pair
The USDJPY came down and tested a lower trend line before the US stock opening. That trend line held. Stocks are moving higher now on hopes of a China/US agreement over the weekend. The 100 hour MA above has now been breached.
The price is not running higher. There is another swing area not far away at 113.649-699 dating back to November 15. On Tuesday/Wednesday, the price moved above the area, but tumbled back below on the “more dovish” comments from Fed Chair Powell.
So the market is hedging the more dovish Fed from Wednesday and potential a more hawkish Fed if China/US reach some truce on trade. That seems to be the trade.
For now, the traders are being encouraged by higher stocks – at least a little.