During the US session tonight, USDJPY has begun to show signs of a potential reversal after failing to create a new lower low, which typically indicates a continuation of the downtrend. Instead of continuing its decline, the price has successfully broken through the resistance level of the bearish channel, paving the way for the formation of a new price structure that supports a bullish direction. This breakout signals that buying pressure is starting to dominate, suggesting that buyers are gradually taking control of the market. Technically, this price structure indicates the potential for a trend shift from bearish to bullish in the short term.
Additional support for the reversal chances comes from the MACD indicator on the one-hour timeframe, which is beginning to shift into the positive zone, indicating that upward momentum is starting to develop. As long as the price remains above the broken resistance zone and MACD continues to strengthen, USDJPY has room to continue its rally towards the next resistance area.
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Meanwhile, on the 15-minute time frame, USDJPY is also displaying intriguing technical signals with the successful breach of the neckline of the inverted head and shoulders pattern, known as a reversal pattern. This breakout indicates an increasing dominance of buyers in the short term. If the price can hold above this neckline, the opportunity for an increase towards the resistance level around 144.485 widens significantly. For market participants, this pattern serves as an early indication to consider buy positions during the initial phase of the reversal movement.
Technical Reference: buy as long as above 143,470
Potential Take Profit 1: 144,255
Potential Take Profit 2: 144,485
Potential Stop Loss 1: 143,685
Potential Stop Loss 2: 143,475
