My Technical Analysis: USD/JPY Daily Chart Looking at this daily chart, I see USD/JPY in a well-defined downtrend that has been making consistent lower lows over several months. Price has declined from the 162.000 region, breaking through multiple support levels, and is now trading near 159.694. The sell-off has been persistent, with each attempted bounce getting sold into. My analysis using FVGs, Order Blocks, and S/R focuses on identifying where the next potential support might emerge and whether were approaching exhaustion levels on this highest timeframe.
My Read on the Market Structure & Key Levels How I View the Current Context: The macro structure is bearish with a clear sequence of lower highs and lower lows. The downtrend has been steady and methodical, with price respecting the descending channel over several months. Momentum remains with the sellers, and pullbacks have been shallow, indicating persistent selling pressure. There are no clear reversal patterns forming yet on the daily timeframe.
The Critical Zones Im Watching: Current Support (Testing): The
159.500 - 159.700 zone is the current level being tested. Price is hovering near the recent low of 159.694.
Next Psychological Support: Below current levels, the
159.000 round number is the next obvious target, followed by
158.000 and the critical
157.000 level.
Immediate Resistance (First Hurdle): The
160.000 - 160.500 zone is the first key resistance, representing the broken psychological support that should now act as resistance.
Primary Resistance (Trend Reversal Level): The
161.000 - 161.500 area is the significant resistance that would need to be reclaimed for any hope of trend reversal. This was a previous consolidation zone.
Where I Identify the Fair Value Gap (FVG): The sharp sell-off from 161.000 created multiple bearish FVGs. The most significant imbalance zone I see is between approximately
160.000 and 160.500. This gap now acts as a magnetic resistance zone. Any bounce into this FVG would be a textbook opportunity for sellers to re-enter, filling the imbalance before potentially continuing lower.
My Order Block Analysis: Bearish Order Blocks (Supply Zones): Primary: 161.000 - 161.500 – The breakdown candle cluster that initiated the most aggressive leg down.
Secondary: 160.000 - 160.500 – The rejection area where selling pressure emerged during the consolidation.
Bullish Order Blocks (Demand Zones): I dont see any significant bullish blocks forming yet on the daily timeframe. The
159.000 and
158.000 zones might attract buyers due to psychology, but no structural demand has been established.
My Trading Plan & Bearish Bias My bias is bearish, and Im looking to sell rallies rather than buy dips on this highest timeframe.
My ideal scenario is a bounce that climbs into the FVG and bearish order block confluence zone between 160.000 and 160.500. Ill wait for a clear rejection pattern there to consider a short entry, targeting a break below
159.500 toward
159.000 and potentially
158.000. If price continues to grind lower without a meaningful bounce, I might consider a breakout short below
159.500, but I prefer the better risk/reward of a pullback entry. The only thing that would make me reconsider the bearish view is if price powers back above
161.500 and holds—that would invalidate the breakdown structure. Until then, Im treating any strength as a selling opportunity in this persistent downtrend.
Risk Warning: On the daily timeframe, moves take significant time to develop. Ill keep position sizes smaller and stops wider to account for daily volatility. The
159.000 and
158.000 psychological levels are major round numbers and could attract significant buying interest. Ill watch for signs of exhaustion there. Patience is essential on higher timeframes—the next few daily candles will be crucial in determining whether we get a relief bounce or continue lower.
