USD/JPY Technical Analysis: Bulls remain in control near 1-1/2 week tops, around mid-109.00s

• USD/JPY continues scaling higher for the fourth consecutive session.
• Slightly overbought conditions on hourly charts warrant some caution.

The USD/JPY pair added to the previous session's strong intraday positive move of around 160 pips and continued gaining traction through the early European session on Thursday.

The overnight strength above the very important 200-day SMA and a subsequent move beyond the 109.00 handle was seen as a key trigger for bullish traders and driving the pair.

The momentum – marking the fourth day of a positive move – lifted the pair to 1-1/2 week tops, with bulls now aiming for a move towards multi-month tops, around the 109.70 region.

Oscillators on the daily chart have again moved into the positive territory and support prospects for further gains, albeit slightly overbought conditions on hourly charts warrant some caution.

Hence, it will be prudent to wait for some near-term consolidation or a modest pullback before traders start positioning for a move towards reclaiming the key 110.00 psychological mark.

Dip-buying now seems to help limit the downside near the 109.00 handle, albeit some follow-through selling has the potential to drag the pair back towards the 108.65 region (200-DMA).

USD/JPY daily chart