FX.co ★ Technical analysis of USD/JPY for January 05, 2021

Overview :

The USD/JPY pair dropped from the level of 103.91 to the bottom around 102.73. But the pair has rebounded from the bottom of 102.73 to close at 103.01.

Today, the first support level is seen at 102.73, and the price is moving in a bearish channel now. Furthermore, the price has been set below the strong resistance at the level of 103.18, which coincides with the 38.2% Fibonacci retracement level.

This resistance has been rejected several times confirming the downtrend. Additionally, the RSI starts signaling a downward trend. As a result, if the USD/JPY pair is able to break out the first support at 102.73, the market will decline further to 102.55 in order to test the weekly support 2.

In the H1 time frame, the pair will probably go down because the downtrend is still strong. Consequently, the market is likely to show signs of a bearish trend. So, it will be good to sell below the level of 103.18 with the first target at 102.73 and further to 102.55.

This suggests that the pair will probably go down in coming hours. If the trend is able to break the level of 102.55, then the market will call for a strong bearish market towards the objective of 102.37today. It would indicate a bearish market.

At the same time, the breakup of 103.32 will allow the pair to go further up to the levels of 103.91 in order to retest the double top again.