Usdjpy Drops From Peak

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Usdjpy Drops From Peak

Usd/Jpy Drops From Peak Near 161.95

The USD/JPY pair continues to drive lower under the influence of the sellers. The pair has already made a lot of progress towards the downside, considering it had a peak near 161.95. Today, the exchange rate of USD/JPY is near 156.50, showing a drop of almost 500+ pips.

Recently, USD/JPY has also dropped below a trendline near 158.45 which was a signal of a major trend shift. Additionally, the pair also ended up closing below the support of around 157.15, further strengthening the case of a bearish trend.

Medium-Term Trend Of Usd/Jpy Favors Downtrend

Right now, USD/JPY's short-term trend favors the bears, while the medium-term trend is also shifting in favor of the bears. As we all know, it is best to follow the trend in investing, so it makes sense to do the same for USD/JPY.

Now the question is when the descent of the USD/JPY will stop. The next target for the Dollar/Yen pair is around 154.90, where the 61.8% fib retracement is located. After that, the next stop is near 153.21, another important support before the 153.00.

If the recent downtrend in USD/JPY continues even beyond that, the next targets for the USD/JPY bears will be 151.84 and then 151.50.

However, that might not come to fruition yet as the RSI (14) shows that USD/JPY has already entered into oversold territory. So, it makes sense to expect a pullback from the recent lows, but that will also depend on the fundamental news from the USA and Japan.

In other news, the Bank of Japan is reportedly thinking about hiking the rates, while the US Federal Reserve is widely expected to start its rate-cutting cycle in September 2024. If both of these things happen, it will mean a fundamental shift in the USD/JPY.

In that case, the USD/JPY will likely turn lower and start trading in more acceptable ranges, as it used to be a few years ago.

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