The pair declined toward the firm support of previous lows, which has been tested a couple of times in April and has managed to hold so far. This support is at 107, and as long as the greenback trades above this zone, the short-term outlook seems bullish.
However, if the US dollar drops below this support, larger stop-losses could be hit, which might send the USDJPY pair quickly lower, targeting 106.50 or 106.00.
It is hard to imagine the US dollar strengthening as the Fed's balance sheet continues to soar each day.
The resistance could be spotted at the bearish trend line at 107.50. This trend line has been limiting the pair since early April. Should the pair break above this level, the medium-term trend could indeed change to bullish, despite the Fed printing trillions each month.
Another resistance could then be located in the 107.70-108.00 zone, where previous swing highs are located.