The US dollar managed to hit a 3 -year high against the Yen following expectations that rising energy prices would push Japan to increase demand for the US dollar.
The yen's gloomy movement continued to be pressured by the strengthening US dollar in earlier trading this week while investors also remained cautious ahead of the release of US inflation data on Wednesday.
On the price chart of the USD/JPY pair, the price is seen to have continued the surge at the opening of trading earlier this week after last weekend's rise managed to break the resistance level of 112.00.
The significant price spike on Monday yesterday has recorded a daily rise of around 130 pips reaching a high of 113.400.
The price is still positively moving in a bullish trend since last week minutes above the support level of the Moving Average 50 (MA50) on the 1 hour time frame of the price movement.
But after yesterday's energetic price spike, the upward momentum began to fade with the horizontal movement of prices in the Asian session this morning (Tuesday) and prices showing signs of decline at the beginning of the European session.
With yesterday's price spike, analysts see the rise in price will continue for the price to head to the high of 114.00.
That level is the price resistance zone that was last tested in November 2018 trading.
On the other hand, if the price plummets again, the 112.00 level will be tested again to form the latest RBS (resistance become support) zone.
A decline beyond the MA50 support will also signal for a change in the price bullish trend.
