Red lines- bearish RSI divergence
USDJPY is trading in a bullish trend making higher highs and higher lows. Price made new highs today but the RSI continues to form lower highs. The bearish divergence in the RSI is a sign of weakening up trend. Price made a marginal new high and although technically trend remains bullish, such bearish divergence usually precedes turnarounds. The chances for a reversal have increased. Bulls need to be cautious. A pull back is imminent in USDJPY. So far there is no reversal confirmation. Bulls remain in control of the trend. At current levels we prefer to be neutral if not bearish. Upside potential is limited.
