USD/JPY Price Analysis: Technical set-up remains tilted in favour of bullish traders

• USD/JPY manages to regain some positive traction on Wednesday.
• Bulls might aim towards multi-month ascending trend-line resistance.

Following the previous session's brief pause, the USD/JPY pair regained some positive traction on Wednesday and remained well within the striking distance of multi-month tops set last week.

Given that the overnight modest pullback attracted some dip-buying near the 109.70 strong horizontal resistance breakpoint now turned support, the set-up remains tilted in favour of bullish traders.

This coupled with the fact that the pair remains above important moving averages – 50, 100 & 200-day SMA – adds credence to the bullish outlook and support prospects for additional gains.

Meanwhile, technical indicators on the daily chart have been retreating from recent high but have still managed to hold in the positive territory, reinforcing the near-term constructive set-up.

However, oscillators on hourly charts now seemed struggling to gain any meaningful traction and warrant some caution before placing aggressive bets for any further appreciating move.

Hence, it will be prudent to wait for some follow-through buying beyond the 110.20-30 region, above which the pair might aim towards the 111.00 handle – a five-month-old ascending trend-line.

On the flip side, the 109.70 region might continue to protect the immediate downside, which if broken might negate the near-term bullish bias and prompt some aggressive long-unwinding trade.

The pair then might accelerate the corrective slide further towards the 109.35 intermediate horizontal support before eventually dropping to 50-day SMA en-route the 109.00 round-figure mark.

USD/JPY daily chart