Technical outlook:
USDJPY dropped through the 134.25 mark on Thursday before finding bids coming in. The currency pair managed to pull back close to the 135.00 mark before hitting resistance again. It is trading close to 134.80 at this point in writing and is expected to drop below the 134.25 mark in the near term.
USDJPY has already carved a larger degree upswing between 102.50 and 136.70 by producing a religious uptrend since January 06, 2021. Prices are just about to break below the immediate support trend line as bears remain poised to take out initial support at the 131.50 mark. The currency pair will be well placed to take out the larger degree of support around the 126.36 mark thereafter.
USDJPY is looking to drag lower below the 134.25 mark before pulling back in the near term. Prices are expected to produce an intraday corrective rally towards the 135.80-136.00 range but remain capped below the 136.70 highs. Bears will be poised to come back in control thereafter and drag prices through 131.50 levels.
Trading plan:
Potential drop through 131.50 and 126.00 against 137.00
Good luck!
