20.03.2023 06:01 PM
Increased chances for upward reversal in USDJPY.

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Yellow line- bullish divergence

Blue lines- Fibonacci retracements

Red lines- bearish channel

USDJPY is trading around 131.60. Short-term trend remains bearish. Price continues making lower lows and lower highs. Price is still inside the downward sloping red channel. As long as this is the case, trend will remain bearish. Price has now reached an important Fibonacci retracement level. Price has retraced 61.8% of the entire rise. The decline has so far paused at the 61.8% retracement level. At this retracement level we usually see trend reversals. The RSI has been making higher lows providing us with bullish divergence. Resistance by the channel is at 132.47. The combination of a bullish divergence in the RSI and a bounce off the 61.8% retracement level, increase chances of a reversal. If such a bounce will come and price breaks out of the bearish channel, then we should confirm that a low is in.

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