USD/JPY Price Analysis: The pair is flirting with 106.00 as the dollar makes a small comeback

• USD/JPY has just moved above flat again and is trying to crack 106.00. 
• There are a couple of bullish signs and the next major resistance is at 106.20.

USD/JPY 4-hour chart

USD/JPY has been slowly pushing away from its lows after the resignation of former Japanese PM Abe. The vote to replace Abe is set for 14th September and his right-hand man Yoshihide Suga looks like the front runner for the role. 

Having said that the pair has not even retraced 50% of the move lower. A break above the green resistance point of 106.20 would be a good signal for a test of 107.00. On the downside, the key support zone resides at 105.25. There is also a black upward sloping trendline that could provide some support and this is currently just above the aforementioned support. 

The indicators are just slightly bullish at the moment as the MACD histogram has just moved into the green. Despite this, the signal lines are below the midpoint and this is a bearish signal. The Relative Strength Index is just above the 50 middle point and is sloping higher. 

The current trend is still sideways at the moment. On the daily chart, 104.18 is the main low but if the bulls can break and hang on to 106.00 leading into Friday's non-farm payrolls we could be in for an interesting end to the week.

Additional levels