The USDJPY pair has started to show signs of a trend reversal after an unsuccessful attempt to continue rising, despite briefly breaking through the upper boundary of a bullish channel. This failed breakout created a false break pattern, indicating that buyers have lost control, allowing sellers to take over. The return of prices to the selling pressure zone has shifted the technical structure from a bullish bias to a more bearish pattern.
The signals for a decline are becoming increasingly robust as the ZigZag pattern begins to establish a series of lower highs and lower lows, confirming that price movements are now consistently trending downward. In tandem, the declining Moving Average line and the MACD residing in negative territory provide additional confirmation that the momentum on the buyer side is weakening. Collectively, these three elements underscore that bearish pressure is developing and has the potential to persist.
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The USDJPY is moving steadily within a bearish channel and is clearly demonstrating a downward trend. Prices are also facing rejection from the resistance level on the Bollinger Bands, strengthening the signals that bearish momentum remains dominant. With the technical structure consistently oriented downward, USDJPY is likely to continue weakening and test a crucial support area at the 154.930 level.
Technical Reference: Sell while below 155.715
Potential Take Profit 1: 155.585
Potential Take Profit 2: 155.715
Potential Stop Loss 1: 155.060
Potential Stop Loss 2: 154.930
