Early in the American session, the Japanese yen is trading around 144.35, below the 21 SMA below 8/8 Murray.
Last week, the Japanese yen weakened to a low of 145.05 which was seen as an overbought sign. Since then, we are watching a strong technical correction. In the coming days, USD/JPY is likely to fall towards the 200 EMA located at 140.99.
Since the Yen reached the 145.00 level, speculations have increased about a possible intervention by the Japanese government to halt any further depreciation of the yen. This is a factor that could limit the rise of USD/JPY and we could expect a technical correction to occur in the next few days.
According to the 4-hour chart, we can see that the Japanese Yen has broken out of the uptrend channel that had been formed since June 12. A technical correction is now expected to follow. Immediate support is at 143.75. If this level is broken, USD/JPY could reach 7/8 Murray at 142.18.
For USD/JPY to resume its bullish cycle, we expect a close above the psychological level of 145 on the daily chart. Then, it could climb to 145.31 and could even reach +2/8 of Murray located at 146.87.
Given that the Eagle indicator has been giving a negative signal since June 27, the Japanese Yen is expected to fall towards levels of 140.99 (200 EMA) in the next few days, which will be seen as an opportunity to sell.