USD/JPY has rebounded from 151.93, finding support at the bottom of the falling price channel visible on the 4-hour chart. This bounce indicates that the pair may be entering a consolidation phase within its downtrend from the 161.95 high.
Short-Term Outlook
We can expect further upside in the coming days, with the next target being the top of the falling channel. However, it’s important to note that as long as the channel resistance holds, the overall downtrend remains intact.
Key Levels to Watch
Support levels:
- Initial support: 153.05
- Recent low: 151.93
- Next support: 150.90
- Psychological level: 150.00
Resistance levels:
- Channel resistance (top of the falling channel)
- Next resistance: 155.80
Potential Scenarios
- Bearish scenario:
- If USD/JPY breaks below 153.05, it could trigger another fall to retest the 151.93 support.
- A break below 151.93 could lead to further declines towards 150.90 and potentially the 150.00 area.
- Bullish scenario:
- A breakout above the channel resistance could signal a potential trend reversal.
- If the pair moves above 155.80, it might indicate the completion of the downtrend.
Conclusion
While USD/JPY is showing signs of consolidation, the overall trend remains bearish as long as the pair stays within the falling channel. Traders should closely monitor the key support and resistance levels for potential trading opportunities and trend reversal signals.
Remember to always use proper risk management techniques and consider multiple timeframes when making trading decisions based on this analysis.