What looked like a bearish breakout of the triangle formation, turned into more of a fake-out last week after USDJPY strongly pushed above 100.00. It could also be that simply the 109.00 support held, but of course, this all happened simultaneously with the Evergrande developments in China that greatly affected risk sentiment all throughout the past week.

The daily chart now shows that USDJPY is headed to the 111.50 area, where it will likely meet the strong resistance. There is little that stands in the way between current prices and 111.50, which means this area will likely be reached.

What happens there could be anyone’s guess. In case of a bullish break above 111.50, the next resistance is likely to stand at levels above 112.50. Based on a newly-formed ascending channel formation, USDJPY can rally toward 113.00 before it hits the upper line of this channel. So, this zone would be the next resistance higher.