USD/JPY Looks to Correct Gains

By Yan Petters – The USD/JPY pair saw quite a consistent bullish trend during the past month. The pair gained about 400 pips during the last four weeks, rising from the 80.20 level up to the 84.20 level on Friday. However, after the pair failed to breach through the 84.20 level it began correcting gains, and is now trading near the 83.90 level. The bearish correction is likely to extend today, with potential to reach the 83.00 level.

• The chart below is the USD/JPY 4-hour chart by ForexYard.
• There is a very distinct bearish channel formed on the 4-hour chart, and the pair is now floating in its bottom.
• The pair recently reached as high as the 84.20 level, yet this appears to have initiated a mild bearish correction.
• The Slow Stochastic has just completed a bearish cross above the 80-line, indicating that a bearish correction might take place.
• In addition, the RSI is now pointing down, reaching towards the 70-line. If the RSI will cross the 70-line, it is likely to validate the bearish move.
• The next support levels are located at the 83.80, 83.50 and 83.00 levels.
• The next resistance levels are found at the 84.20, 84.90 and 85.30 levels.

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