USDJPY has reached our 104 target level and is now bouncing higher. There are bearish divergence signs by the RSI that does not follow price to new lower lows. This is a warning that tells me there are significant chances of an upward bounce towards 105.
Pink line - resistance
Black lines - Fibonacci retracement levels
USDJPY is bouncing and it is now ready for a move towards the 38% Fibonacci retracement in the area of 105. This is not the time to be bearish USDJPY. Price is expected to move higher as the RSI is turning upwards from oversold levels. The bullish divergence should not be ignored either. It is not a reversal signal but a powerful warning to bears that a pause is coming to the downtrend. First target is 105 and next at 105.45.
