Red line- resistance
Green line- support
Blue lines- bullish channel (broken)
USDJPY is trading around 136.80. Price recently provided us with a bearish signal when price broke out of the bullish channel it was in since the beginning of August. Price made a sharp decline towards 135.80 and bounced towards 137 afterwards. USDJPY as we explained in previous posts, has the potential to move even lower towards 135.30. At current prices we continue to prefer to be bearish. A break below 136.40 and the green support trend line, will confirm our bearish view and push price even lower towards our first target of 135.30. Our bearish scenario will get very few chances of success if bulls manage to push price above the red resistance trend line at 137.30.
