USD/JPY has rallied just past this month's previous high and other resistance near 109 on waning worries about the U.S.-China trade war and a no-deal Brexit, but it needs a deal between Washington and Beijing by the Nov.
16-17 APEC meeting to end a downtrend dating back to the 2015 BOJ QQE peak. USD/JPY charts show scope for further gains once above the 200-DMA, now at 109.06, and $4bln of 109 expiries over the next three sessions nL2N27D0FB.
If trade talks news stays positive, the Fed cuts rates Wednesday but hints at a pause, and Friday's U.S. jobs data, ISM and Q3 don't spoil the current risk-on USD/JPY rise, the focus will shift to clearing August's high, the 61.8% Fibo of 2019's drop and the weekly kijun at 109.32/37/42.
That resistance could be cleared this week.
But USD/JPY might not clear the downtrend line from 2015 and 2018 peaks by a variety of other technical targets near 110.50 unless Trump and Xi sign a phase 1 trade deal at APEC.
And with often lagging IMM specs already squeezed out of losing August and September shorts and starting to build net longs, the clock may be ticking on the next top in prices unless trade-related angst is truly in retreat.