USDJPY: Preparing for the next Bearish trend

USDJPY is in a bullish market zone both in the long-term and medium-term outlooks but may likely break down the support level soon.
The bears may likely resume and continue the journey to the lower support area.

USDJPY Weekly Price Analysis – August 26
It looks like the price will want to crash down. Should the bears increase their price action in the market; the support level of $131.597 may be tested, and the price may decrease to the $126.551 support level.

Key Levels:
Resistance levels: $137.700, $137.800, $137.900
Support levels: $131.500, $131.400, $131.300

USDJPY Long-term Trend: BullishThe currency pair trades in a bullish market zone on its higher time frame. The bulls’ pressure on the currency pair in the previous action at a $137.649 supply level further led to an increase in the market price of the Yen during yesterday’s session and sustained it.

A reversal in the momentum of the price of USDJPY resulting from the interaction from the sell traders occurs as the price dropped down to $137.083 above the moving averages as the daily session opens today. This indicates that the sellers are coming into the market gradually to dominate.

Activities from the bears further dropped the market value of the Yen down to a $136.397 low level; therefore if the bulls increase their action, the price of USDJPY may likely drop beyond the key levels in the support area.

Thus, there is a possibility of more downsides as indicated by the daily stochastic pointing down in the overbought region; it means that the buying pressure is exhausted and ready for a sell-off. If this is achieved, the $126.551 support level might be retested in the coming days in the higher time frame.

USDJPY Medium-term Trend: Bullish USDJPY trades in a bullish market zone in its medium-term outlook. The bears could not wait for the bulls to retain the trend; there comes a reversal in the trend.

Today’s 4-hourly opening candle at the $136.937 support level is bearish; this is a result of the intervention from the short traders.

Continuation to the south is confirmed by the bearish candle at a $131.397 low level below theEMA-9 at the time of writing this article. This implies that the sellers are gaining more strength in the context of the market’s strength and the bulls are getting weaker at the moment.

Hence, more downsides are certain as the price signal is pointing down, indicating that the price of USDJPY is in a downtrend. The pair may likely reach the $126.551 support level soon in its medium-term view.

Hence, the sell traders need to wait for this action to take place completely before taking an action.

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