The USDJPY currency pair has experienced notable shifts in momentum after breaching the resistance level within a bearish channel. Despite initially signaling potential gains, the price struggled to maintain its upward trajectory post-breakout and quickly reversed direction. This failure to establish a higher high suggests a waning push from buyers, making the likelihood of a bull trap increasingly apparent. Such circumstances reintroduce opportunities for sellers to regain control after the recent price action faltered in sustaining an uptrend.
From a technical perspective, bearish pressures are becoming more pronounced with moving averages heading downward and the MACD shifting into negative territory. This indicates a change in short-term momentum towards declines. The combination of these signals reflects a shift in market sentiment from bullish optimism to caution, particularly if USDJPY cannot create a new upward structure. Should the selling pressure persist, this pair risks continuing its descent towards significant support levels that may serve as the next testing point.
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On the 15-minute time frame, the rejection at the upper Bollinger Bands followed by a breach of the BB support area further underscores the bearish outlook for USDJPY. Additional signals emerge from the CCI, which has sharply dropped from overbought conditions, indicating increasing room for sellers tonight during the US session. With this series of technical confirmations, USDJPY stands a chance to proceed with declines toward the support level of 155,090, identified as a primary short-term target.
Technical References: buy while above 156,930
Potential Take Profit 1: 156,930
Potential Take Profit 2: 157,080
Potential Stop Loss 1: 156,340
Potential Stop Loss 2: 156,180
