FX.co ★ Trading Signal for USD/JPY for October 19-20, 2022: sell below 149.60 (8/8 Murray - top uptrend channel)

Early in the Asian session, the Japanese Yen (USD/JPY) is trading at around 149.15. A strong bullish trend is unfolding, but the currency pair would be showing levels of exhaustion and a technical correction is possible in the coming days.

The resistance zone of 8/8 Murray and the psychological level of 150.00 has become a barrier for the Yen. In case there is a pullback towards the top of the uptrend channel around 149.60 or towards the 150.00 zone, it could be considered an opportunity to sell with targets at 7/8 Murray around 146.87

The Japanese yen reached its weakest levels in 32 years. USD/JPY has been accumulating a bullish run for 10 consecutive days without showing any technical correction.

Finance Minister Shunichi Suzuki warned that the government will take decisive action against the strong volatility of the extremely soft yen fueled by speculators.

In the event of an intervention by the Bank of Japan in the coming days, this will prove to be a key factor that could strengthen the Yen and it could quickly fall towards the bottom of the uptrend channel around 146.80.

The eagle indicator reached the extremely overbought zone around 95-points. So, in the course of hours, a strong technical correction is likely to occur and the pair could fall towards the 21 SMA zone located at 145.60.

Our trading plan for the next few hours is to sell below 149.60 or wait for a pullback towards the psychological level of 150.00 to sell with targets at 146.87 (7/8 Murray) and 145.60 (21 SMA).