Market NewsTechnical AnalysisUSD/JPY

USD/JPY: Is the Pair Getting Bearish by Producing a Double Top?

  • The pair had its second rejection at significant resistance
  • Simple Moving Average 30 has been working as a support
  • The buyers are to wait for the price to make a bullish breakout at the last swing high
  • Intraday price action has been bearish
USD/JPY H4 Chart
USD/JPY H4 Chart

USD/JPY Trades around Substantial Resistance

The pair after being very bullish on the H4 chart had a rejection at 146.400 last week. The price made a bearish correction and made a bullish move upon finding its horizontal support at 145.000. As of writing, the pair trades around the last swing high. A bullish breakout at the level may attract the buyers to go long in the pair and push the price towards the North. The price may find its next resistance around 147.800. Simple Moving Average has been working as support. The price may produce a bullish reversal pattern at the SMA 30’s support to make its bullish move.

On the downside, 146.400 has been a substantial resistance. The price had its second resistance. If it continues its bearish move and makes a bearish breakout at 145.000, the Bear may take over and drive the price towards the South.

USD/JPY H1 Chart
USD/JPY H1 Chart

The H1 Chart Trades on a Double Top

The H1 chart shows that the price had strong rejection twice at 146.400. At the last rejection, it produced an Inverted Hammer and made a strong bearish move. On its way, it made a breakout at 146.050. It is a neckline breakout. Thus, the sellers may be keen to look for short opportunities on intraday charts. The price may find its next support around 145.450.

On the upside, the chart is to produce a strong bullish reversal pattern at value areas or to make a bullish breakout at the Double Top’s resistance for the buyers to attract to go long in the pair. As things stand, the pair may make the buyers wait to find long opportunities with lucrative risk-reward.

The H4 chart is bullish-neutral and the H1 chart looks very bearish. Since the H4 chart is in search of support, meanwhile, the H1 traders may drive the price towards the South.

Written by: Md Tareq Sikder, Senior Analyst Forex Prop News

Contact and follow Tareq on Twitter: @tareqfpn

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