• The USD/JPY edges higher in the year’s last trading day, up some 0.03%.
  • A risk-off market mood put capped the downtrend of the USD/JPY.
  • USD/JPY Price Forecast: The upward bias to continue, a break above 115.20 would open the door for a test of the YTD high at 115.52. 

As of year-end looms, the USD/JPY extends its rally to three consecutive days, trading at 115.12 during the New York session at the time of writing. A risk-off market mood, as portrayed by US equity indices trading in the red, while the CAC 40 and FTSE 100, the only two European stock markets open, slide between 0.28% and 0.32%, each. 

In the meantime, US Treasury yields, with the 10-year benchmark note, edge lower one and a half basis points, down to 1.502%, a headwind for the USD/JPY. The US Dollar Index, a measure of the greenback’s value against a basket of six rivals, slides some 0.28%, sits at 95.70.

Thin liquidity conditions attributed to holidays in Japan, Australia, and New Zealand kept the USD/JPY within familiar levels. The lack of worldwide macroeconomic news, as investors book profits, put a lid on the USD/JPY, which in the last hour or so, retraced from monthly highs.

USD/JPY Price Forecast: Technical outlook

The USD/JPY hourly chart portrays the pair has an upward bias, even though it dipped to the confluence of the 50-hour simple moving average (SMA) and the daily pivot point around 115.06.

To the upside, USD/JPY’s first resistance is the year-to-date high is the November 24 high at 115.52. A breach of that level would expose crucial resistance levels, like the 116.00, followed by the December 2016 swing lows at 118.65.

On the other hand, the first line of defense for USD bulls would be 115.00. A break of that level would be the December 29 cycle low at 114.67 and the 200-hour SMA at 114.60.

This article was originally published by Fxstreet.com.Read the original article here.