USD/JPY Correcting from 102.59

The United States dollar versus the Japanese yen currency pair seems to have entered a corrective phase. But is this just a simple correction?

Long-term perspective
From 108.16, which represents both the high etched after the price falsely pierced the 108.05 intermediary level and the starting point for the falling trendline that keeps the descending trend in check, the price extended until the 102.59 low.
Along this descending trend, the price noted very sharp declines followed — most of the time — by equally sharp but less tall retracements, both being separated by consolidative phases that rested on relevant support areas and made sure they touch — except for 104.57 — the trendline.
So, it is reasonable to expect that if the current rally stabilizes above 103.74, the price may validate the trendline once more — as resistance, of course — and then slip under 103.74 to head for 103.15.
Still, if 103.74 turns the price around, it would be interesting to see if 103.15 favors a bearish unfolding or sets in a consolidation phase with 103.74 as resistance. In turn, the consolidation may seek to validate the double resistance defined by the trendline and the 103.74 level. If 103.15 cedes, then 101.42 may be the next target.
On the other hand, if the trendline finally gives way, the appreciation could extend the firm level of 105.09.

Short-term perspective
From the 102.59 low, the price started a rally that attempts to conquer 103.71. As of writing, the price noted the 104.00 high.
As can be seen, the previous peaks around this area were met with a bearish response.
So, as history repeats itself, a turn under 103.71 is a possible outcome for the current situation. This exposes 103.05.
Nevertheless, if this time, the appreciation is vivid enough to continue, 104.44 is the next bullish objective.

Levels to keep an eye on:

D1: 103.74 103.15 101.42 105.09
H4: 103.71 103.05 104.44 102.43

If you have any questions, comments, or opinions regarding the US Dollar, feel free to post them using the commentary form below.

Original from: www.earnforex.com