FX.co ★ Trading plan for USDJPY for April 07, 2022

Technical outlook:

USDJPY is preparing to turn lower from here anytime soon, after having tested around 124.00 highs recently. The currency pair has now completed its counter trnd rally and is looking ready to resume lower towards 116.35 and 115.00 levels respectively. Bears will have to keep prices in check below the 125.00-10 mark to keep the structure intact.

USDJPY had earlier dropped from 125.00 high toward 121.50, carving a meaningful downswing as seen on the 4H chart here. Furthermore, the subsequent rally was also corrective reaching up to 124.00 levels. Also note that it has reached the Fibonacci 0.618 retracement of the earlier drop between 125.00 and 121.50 levels.

High probability remains for prices to turn lower from here and proceed towards 116.35 at least. USDJPY is now looking to produce a downswing back to its past resistance turned support zone around 116.35 mark. A slip further through 115.00 will confirm that overall trend has reversed and bears are back in control.

Trading plan:

Potential drop to 116.35 against 125.50.

Good luck!