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USD/JPY Still At Risk of Additional Losses

Key Highlights

  • USD/JPY started a fresh decline below the 130.00 zone.
  • A major bearish trend line is forming with resistance near 131.00 on the 4-hours chart.
  • EUR/USD could aim a fresh increase above the 1.0880 resistance.
  • Bitcoin price is consolidating gains near $21,000.

USD/JPY Technical Analysis

The US Dollar started a fresh decline from well above 130.00 against the Japanese Yen. USD/JPY traded below the 129.50 support to enter a bearish zone.

Looking at the 4-hours chart, the pair declined below the 129.20 level. It also settled below the 129.50 level, the 100 simple moving average (red, 4-hours) and the 200 simple moving average (green, 4-hours).

A low is formed near 127.24 and the pair is now consolidating losses. On the upside, an initial resistance is near the 129.00 level.

The next major resistance may perhaps be near 131.00 and the 100 simple moving average (red, 4-hours). There is also a major bearish trend line forming with resistance near 131.00 on the same chart.

A clear move above the 131.00 resistance might start a steady increase. In the stated case, USD/JPY could even surpass the 132.00 zone. The next key hurdle is near 133.50, above which the pair could climb towards the 134.80 resistance zone.

On the downside, there is a major support at 128.00. The next major support is near the 127.20 level. A downside break below the 127.20 zone might push the pair lower.

The next major support sits near the 126.50 level. Any more losses might open the doors for a move towards the 125.00 support zone.

Looking at EUR/USD, the pair is attempting an upside break above the 1.0880 and 1.0920 resistance levels.

Economic Releases

  • US Existing Home Sales for Dec 2022 (MoM) – Forecast -5.4%, versus -7.7% previous.
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