Will USD/JPY Overcome the Mid-Term Downtrend Line?

By Tomasz Wisniewski|

Published: January 03 2024, 08:33 GMT+0

Will USD/JPY Overcome the Mid-Term Downtrend Line?

The USD/JPY currency pair is currently at a pivotal moment, showcasing a potential breakout from a significant mid-term downtrend line, colored red on the chart. This downtrend line has been a defining feature of the pair’s movement since mid-November, capping each of its bullish corrections. Notably, the ongoing bullish correction that began on December 28th is now challenging this key resistance level.

A successful breach of this downtrend line, evidenced by the pair closing above the red line, would mark a critical shift in the mid-term outlook for USD/JPY, signaling a strong buy opportunity. Traders and analysts alike are keenly observing this development, as a breakout could pave the way for sustained upward momentum.

Conversely, should the pair face rejection at this crucial juncture, characterized by the formation of a shooting star or a bearish engulfing pattern, it would suggest the continuation of the downtrend. Such a bearish signal would reinforce the sell perspective, indicating that the downtrend is still firmly in control.

As the trading day progresses, the outcome of this key resistance test will become clearer, potentially setting the tone for USD/JPY’s market direction in the coming weeks.

Source: https://www.axiory.com/analytics/technical-analysis/will-usd-jpy-overcome-the-mid-term-downtrend-line