The USDJPY currency pair is displaying signs of a trend reversal as it successfully breaches the lower bounds of its recent bullish channel. This break signals the initial stages of a waning upward momentum, especially as indicated by the recent shift in the Moving Average (MA) pointing downward. This alteration in the MA suggests that selling pressure is starting to assert its influence, thereby indicating that buyers are losing control in the short term. The price structure is also starting to form new lower lows, further supporting the potential for a downward trend reversal.
The increasing selling pressure is also evident from the MACD indicator, which has now moved into negative territory. This situation reflects a decline in buying momentum and an increase in seller dominance during the most recent trading sessions. Combined with the bearish break from the bullish channel, the downward-moving MA, and the MACD signaling bearish sentiment, the USDJPY now faces the possibility of continuing its decline towards the next support level. In the absence of strong reversal signals, the short-term sentiment remains tilted towards bearish activity.
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This afternoon, the USDJPY is observed continuing its downward trend, with the direction of the Moving Average indicating a bearish trend and the MACD still situated in the negative zone. The synergy of these two technical signals reflects a sustained seller dominance in the short term, driving the price closer to a significant support area around 147.540. As long as no valid reversal signals appear, the potential for further downward movement remains, particularly if that support fails to hold.
Technical Reference: buy when above 148.570
Potential Take Profit 1: 148.380
Potential Take Profit 2: 148.570
Potential Stop Loss 1: 147.720
Potential Stop Loss 2: 147.540
