Technical Analysis

USDJPY: False breakout, more debasement in store


By examining the daily chart of USDJPY pair, we can notice how bulls failed to clear the significant resistance drawn in the 114.50 regions, while the psychological level of 115.00 continued to cap the upside actions successfully.

With that on mind, we suggest additional bearishness, reinforced by the breakout below the rising trend line connecting the movements from 107.50 levels to the recently placed short-term peak.

Furthermore, RSI14 is on the way to achieve more downside moves after breaking its uptrend line, supported by negative divergence.

Another signal comes from Nikkei 225 index, which dropped sharply forming the largest candlestick since November 10/ 2016 as seen on the chart below.

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