USD/JPY Tests Falling Wedge Pattern

Yesterday, the USD/JPY currency pair consolidated at the 108.65 level. During Friday morning, the pair continued to trade at the given level.

Note that the exchange rate is supported by the 55-, 100– and 200-hour moving averages, currently located circa 208.60. Therefore, it is likely that some upside potential could prevail in the market.

However, note that the rate has been testing the upper boundary of the falling wedge pattern since Wednesday. Thus, from a theoretical point of view, a reversal south could occur. In this case the pair could gain support of the weekly PP and the Fibo 38.20% at 108.44.