- USD/JPY topped near 135.60 and corrected lower.
- It broke a major bullish trend line at 135.00 on the 4-hours chart.
- EUR/USD could attempt an upside correction above 1.0520.
- GBP/USD corrected above 1.2200 after the BoE announced rate hike to 1.25%.
USD/JPY Technical Analysis
The US Dollar extended rally above 135.00 against the Japanese Yen before the bears appeared. USD/JPY formed a high at 135.58 and started a downside correction.
Looking at the 4-hours chart, the pair corrected lower below the 135.20 support zone. There was a break below a major bullish trend line at 135.00. The pair declined below the 23.6% Fib retracement level of the upward move from the 126.35 swing low to 135.58 high.
It opened the doors for a move below the 133.50 support zone. The first major support on the downside is near the 131.50 level.
The next major resistance is near the 131.00 zone and the 100 simple moving average (red, 4-hours). It is close to the 50% Fib retracement level of the upward move from the 126.35 swing low to 135.58 high.
Any more losses might call for a test of the 130.00 support or the 200 simple moving average (green, 4-hours). On the upside, an immediate resistance is near the 133.50 level. The next major barrier could be near the 134.00 level.
A clear move above the 134.00 level might push the pair towards the 135.00 level in the near term. Any more gains may perhaps set the pace for a new high above 135.60.
Looking at EUR/USD, the pair could attempt a decent recovery wave if there is a close above the 1.0500 and 1.0520 resistance levels.
- Fed's Chair Powell speech.