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USD/JPY Trying to Breakout after US GDP Data

The Bureau of Economic Analysis (BEA) reported its second estimate for US Q2 GDP. After the 1st, advanced GDP reading came in at 4.0%, forecasts called for a slight revision down to 3.9%. But according to BEA, Q2 GDP growth came in at an annualized rate of 4.2%.

We also saw last week's jobless claims number come in at 298K. We are seeing more and more of this data coming in under 300K, which reflects improving labor market conditions that Yellen and the FOMC have been impressed about. 

Looking at the USD/JPY we see that the pair has been consolidating since starting the week at 104.27, which broke a resistance pivot at 104.13. However, traders are not ready to continue pushing USD/JPY higher, coming down to around 103.60 today.

(USD/JPY 1H chart 8/28)

After the GDP and jobless claims data, traders supported USD/JPY and moved it north of the 200-hour SMA, and the a previous support area. Price is still trying to push above the consolidation pattern resistance an hour after the data release. Will USD/JPY continue its prevailing uptrend since early July?

A break above 104 can clear the consolidation pattern resistance, and the 100- and 50-hour SMAs. This should first open up the 104.27 high on the week, and then the 105.44 high on the year. We should also monitor the 1H RSI to make sure it pushes above 60 to reflect loss of bearish momentum.