Almost all of last week, the USD/JPY pair traded below the 112.658 support level when it acted as a resistance level. Several comments by US president Trump about tax reform tested this resistance level, but news released on Friday finally broke through this level. The release of Japan’s GDP data for the fourth quarter showed that the Japanese economy slowed, and the USD/JPY soared upon this news. It was however unable to penetrate the 113.73 pivot point where the current week started from. Soon afterwards, the Japanese yen took a hit with the preliminary GDP report showing even slower growth, but the currency recovered after positive inflation reports.
On the 4-hour chart, the pair is still trading below the 200-SMA, showing that it is still in bearish territory, but it is now above the 50-SMA. The dollar has been weak all year, leading to the current downtrend, but recent economic data from Japan show that the economy is not as strong either. So, the currency pair is sort of in limbo, waiting for any push.