The USD/JPY pair has recently experienced a pullback from its high of 161.95, breaking below the bottom of the rising price channel visible on the 4-hour chart. This development suggests that we may be entering a consolidation phase for the uptrend that began at the May 3 low of 151.86.
Key Support Level to Watch
Currently, the pair is testing an important support level at 160.26. Traders should keep a close eye on this level, as a breakdown below it could trigger a more significant downside move. If this support fails to hold, we might see the USD/JPY decline towards the 158.00 area.
Potential for Uptrend Resumption
While the short-term outlook appears bearish, it’s important to note that the overall uptrend may still be intact. The initial resistance to watch is at 161.40. A breakout above this level could signal a resumption of the uptrend.If the pair manages to break above 161.40, the next targets for bulls would be:
- The previous high of 161.95
- The psychologically important 163.00 area
Key Takeaways
- USD/JPY has pulled back from recent highs
- Important support at 160.26 – watch for a potential breakdown
- If support fails, next target is 158.00
- Resistance at 161.40 – a break above could signal uptrend resumption
- Upside targets: 161.95 and 163.00
Traders should use proper risk management techniques and consider multiple timeframes when making trading decisions based on this analysis. The current market environment suggests caution, but also presents potential opportunities for both bullish and bearish traders depending on how price action develops around the key levels mentioned.