The USD/JPY pair plunged in the short term after failing to close above the 125.00 psychological level on the H4 chart. Technically, a temporary retreat was expected after such an impressive rally. The price dropped also because the DYX plunged as the Japanese Yen Futures rallied.
At the time of writing, the pair tries to rebound. The Dollar Index started to grow after the US reported better than expected figures. The JOLTS Job Openings, Consumer Confidence, and the HPI came in better than expected.
On the other hand, the Japanese Yen appreciated in the first part of the day also because the Japanese Unemployment Rate dropped unexpectedly from 2.8% to 2.7%.
USD/JPY Natural Retreat!
USD/JPY found resistance above the R2 (124.56) and now is traded at 122.71 right on the 23.6% retracement level. The retreat could be only a temporary one as long as the price stands above the uptrend line.
In my opinion, the price could still reach the uptrend line despite its failure to hit it in the last attempt. Failing to retest the uptrend line may announce a new bullish momentum. Also, testing and retesting the uptrend line or registering only false breakdowns could announce an upside continuation.
USD/JPY Prediction!
Technically, the bias is bullish as long as it stays above the uptrend line. Stabilizign above the 23.6% 122.64 could help the buyers to catch a new upside movement. Only a valid breakdown below the uptrend line could announce a larger drop.
