USDJPY has become volatile and corrective but still maintained the price over 104.00 to 104.10 support level. USDJPY strikes over 104.00 psychological resistance level. Is it the end of the bearish trend? What are the charts and technical indicators are saying? Read more to find further insights into today’s USD/JPY Technical Analysis.
January 12, 2021, | AtoZ Markets – USDJPY is currently trading around 104.30 area and trying to recover higher. After bouncing from 103.60 to 103.70 support area, the bulls pushed the price upside quite impulsively and broke over 104.00 to 104.10 event level. As per the current price action, USDJPY may face strong resistance around 104.50 to 104.70 area in the coming days.
Moreover, U.S. President Donald Trump eminently tweeted that the trade wars were excellent and simple to win” in 2018 as he starts to induct taxes on about $360 billion of imports from China. It turns out, he wasn’t right on the two counts. Even before the Covid-19 infected a huge number of Americans and started the steepest financial slump since the Great Depression, China was withstanding Trump’s tax salvos, as indicated by the very metrics he used to legitimize them. When China got the infection leveled out, interest for clinical equipment and work-from-home gear extended its exchange surplus with the U.S. in spite of the duties.
On the other hand, Japan’s center machinery orders likely dropped in November after the earlier month’s leap, a Reuters survey appeared on Friday, and a highly sensitive situation in the Tokyo zone could damp firms’ funds spending considerably further.
USDJPY Strikes Over as the U.S. Dollar Index Regained Momentum
USDJPY is currently residing near 104.30 area and trying to push further upside. However, the price is still residing below the Kumo Cloud on the daily chart.
Image: USDJPY 4 Hour Chart
According to the 4-hour chart, USDJPY strikes over and currently trading around 104.30 area. As per the current price action, if the price can have an impulsive bullish candle close above 104.30 area, the bulls may recover upside towards 104.50 to 104.70 area in the process. So, if the price recovers upward towards 104.50 to 104.70 area and rejects with an impulsive bearish candle close, the bears may regain momentum and decline towards 104.10 to 104.00 area again in the coming days.
In addition, the dynamic level of 20 EMA is currently residing below the price. It may work as string support to push the price upside. Also, the MACD lines are currently residing above the 0.00 level and may have a bearish crossover. It indicates that bears may regain momentum in the days ahead.
USDJPY May Sustain the Bearish Trend
According to the daily chart, USDJPY strikes over and currently residing near 104.30 area. As per the current scenario, if the price pushes further upward towards 104.50 to 104.70 area and rejects with an impulsive bearish daily candle, the bears may sustain the bearish bias towards 103.70 to 103.60 area as a first target. The second target will be 102.70 to 102.60 area if the price breaks below 103.70 to 103.60 area in the days ahead.
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. So, the dynamic level may act as a strong support to push the price upside. Besides, the Kijun line and the Tenkan line may work as a confluence of the dynamic level in the process. Therefore, the bears may regain momentum if the price can break below the dynamic level in the coming days. Also, the Kumo Cloud is still residing above the price, which may work as strong resistance to push the price downside.
To conclude, as long as the price residing inside the bearish channel, the bias will remain bearish. A daily close is required to identify the definite momentum in the coming days.