USDJPY nose dive below 105.25 to 105.17 support area after rejecting November 2020’s high. USDJPY bears regained momentum as the price faced strong resistance around 105.75 to 105.60 key level. Will it sustain the bearish pressure further in the coming days? What are the charts and technical indicators are saying? Read more to find further insights into today’s USD/JPY Technical Analysis.
February 9, 2021, | AtoZ Markets – USDJPY is currently trading around 104.90 area and trying to decline further. After breaking over 104.60 to 104.70 psychological resistance level, the bulls pushed the price upward quite impulsively and hit 105.60 to 105.70 key level. As per the current price action, the price may retrace downside toward the dynamic level of 20 EMA on the daily chart in the coming days.
Along with this, the Congressional Budget Office said on Monday, the U.S. President Joe Biden’s scheme to increase the minimum wage to $15 each hour by 2025 would chop work by 1.4 million positions that year and increment the budget shortage by $54 billion over the course of the following 10 years. On the contrary, Japanese Finance Minister Taro Aso said on Tuesday, G7 (The Group of Seven) monetary pioneers would kick off an argument on Friday on developing business sector obligation issues, shaping of digital imposition, and national bank digital cash.
USDJPY Bears Regained Momentum as the Price Requires a Downward Retracement
USDJPY is currently residing near 104.90 area and trying to push the price down. However, the price also broke over the bearish channel resistance on the daily chart.
Image: USDJPY 4 Hour Chart
According to the 4-hour chart, USDJPY bears regained momentum and currently trading around 104.90 area. As per the current price action, if the price pushes further downside towards 104.70 to 104.60 area and bounced upside, the bulls may regain momentum and recover higher towards 105.17 to 105.25 area as a first target. The second target will be 105.60 to 105.75 key area if the price breaks over 105.17 to 105.25 area in the coming days.
In addition, the dynamic level of 20 EMA is currently residing above the price. It may work as strong resistance to push the price downside. So, the bulls may regain momentum if the price can break above the dynamic level in the days ahead. Also, the MACD lines are still residing above the 0.00 level. It indicates that the bulls are still holding the bullish momentum.
USDJPY May Sustain the Bullish Bias
According to the daily chart, USDJPY bears regained momentum, but the overall bias is still bullish. As per the current price action, if the price retraces towards 104.70 to 104.60 support area and bounced upside with a daily bullish candle, the bulls may regain momentum and recover higher towards 105.60 to 105.75 area as a first target. The second target will be 106.70 to 106.90 key resistance area if the price breaks over 105.60 to 105.75 area in the process.
Image: USDJPY Daily Chart
Furthermore, the dynamic level of 20 EMA is currently residing below the price. Along with the Kijun line and the Tenkan line. Therefore, the dynamic level may act as strong support to push the price upward. Besides, the Kijun line and the Tenkan line may work as a confluence of the dynamic level in the days ahead.
To conclude, after an extended period of bearish momentum, the price successfully broke over the bearish channel resistance. A daily close is needed to identify the definite momentum in the coming days.