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USD/JPY Signals Pullback—Is the Uptrend Finally Losing Steam?

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Aayush Jindal

Key Highlights

  • USD/JPY failed to continue higher above 157.00 and corrected gains.
  • It traded below a bullish trend line with support at 155.70 on the 4-hour chart.
  • EUR/USD rallied above 1.1700 and 1.1720.
  • GBP/USD regained momentum and cleared the 1.3380 resistance.

USD/JPY Technical Analysis

The US Dollar struggled to surpass 157.00 against the Japanese Yen. USD/JPY started a fresh decline below 156.50 and 156.00.

Looking at the 4-hour chart, the pair dipped below a bullish trend line with support at 155.70. The pair traded below the 50% Fib retracement level of the upward move from the 154.35 swing low to the 156.94 high.

The pair settled below the 100 simple moving average (red, 4-hour). On the downside, there is key support at 154.95 and the 200 simple moving average (green, 4-hour). It coincides with the 76.4% Fib retracement level of the upward move from the 154.35 swing low to the 156.94 high.

The next support is 154.35. A close below 154.35 could open the doors for a test of 154.00. Any more losses might call for a drop to 152.50.

Immediate resistance sits near 156.00. The first key hurdle is seen near 156.30. A close above 156.30 could open the doors for a move toward 157.00. Any more gains could set the pace for a steady increase toward 158.00.

Looking at GBP/USD, the pair gained pace for a strong increase and was able to clear the 1.3380 resistance zone.

Upcoming Key Economic Events:

  • Fed's Hammack speech.
  • Fed's Goolsbee speech.
  • Fed's Paulson speech.
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