Technical outlook:
USDJPY dropped through 114.80 in the early Asian session before reversing higher. The currency pair is trading around 115.20 levels at the time of writing as it is testing the backside of its support turned resistance trend line. Possibility remains for yet another low toward 114.50 before bulls are back in control.
USDJPY has carved a potential Double Top reversal pattern around 116.35-40 zone. A break below 114.20 will add further confidence to the bearish setup and drag lower toward 113.40-50 level. This will confirm that double top is in place around 116.35 mark and that bears are here to stay for long.
On the flip side, if USDJPY bulls succeed in pushing through 115.85 mark, it would open the door to re-test 116.35-40 zone before resuming lower again. Either way, bears remain inclined to drag prices lower through 112.50 and 109.00 from current levels or after printing above 116.35 mark. Traders might prepare to sell on rallies.
Trading plan:
Potential drop toward 109.00 against 117.00
Good luck!
