Technical outllook:
USDJPY continues to defy gravity and prints yet another swing high close to 125.00 mark on Monday. The currency is pulling back at the time of wring and is trading close to 123.80 level. Bulls have taken out a meaningful resistance around 125.00 mark on the weekly chart, which is not seen on the chart.
USDJPY could be on its way to produce a meaningful correction twards at least 116.35 mark soon. The breakout from its triangle consolidation has produced a religious thrust wave higher by almost 1000 points. Initial support is only seen around 121.00 level on the daily chart and a break below will confirm a meaningful top in place.
USDJPY has rallied through 125.00 levels accompanied by a strong bearish divergence on the RSI as displayed on the 4H chart here. It could indicate a potential bearish reversal from here but we have to wait for price confirmation. Watch out for initial support at 121.00 to be taken out for bears to be back in control.
Trading plan:
Remain flat for now, prepare to sell.
Good luck!
