The dollar's hot streak is getting buyers a little jumpy as the pair is up 0.1% on the day to 140.35 in the transition from Asia to Europe today. That is the highest level since 1998 as buyers are looking for a clear break above the pivotal 140.00 mark. It has been a case of taking out key psychological levels (125, 130, 135) on the way up for the pair this year and this (140) is no different:
If we do get confirmation from the US non-farm payrolls later today, buyers will set their sights on 145.00 next. It could come quickly as there is little else stopping the pair from such a move, at least from a technical perspective. The pockets of space in between each key psychological level has been a big reason for more volatile moves during the day in recent months.
Thereafter, the 1998 highs at 146.79-67 will be the next major resistance levels to watch before 150.00 but let's not jump the gun just yet.
The Fed outlook remains key amid a policy divergence with the BOJ but if that factor starts to wane or abate, it won't take much for USD/JPY to run back the other way. At some point, this is going to turn from one of the most bullish currency pairs to one of the most bearish. But for now, we're not there yet and still running in the upwards direction.