Red lines- bearish divergence
Blue rectangle- important short-term support
USDJPY is trading around 135.40 remaining in a medium-term bullish trend for some time now. There are signs that the up trend is weakening but no reversal confirmation yet. The RSI has provided us with important bearish warnings from the bearish divergence signals. The RSI is not making new higher highs as price does. This is a warning that should not be ignored. Short-term support at 134.60 is key. Failure to stay above it will most probably signal that a top is in and correction phase has started. This corrective pull back we expect to see can bring price towards 132 at least. So bulls need to be cautious. This is not the time to be adding to long positions.
