USDJPY: False break higher and time for a big correction?
This morning USDJPY broke higher above resistance at 145 only to be hammered back down. Peaking a few pips from the 1.764 Projection of the August correction at 146.27 buyers ran out of steam.
Sell-off have taken USDJPY below its short-term rising trendline. The sell-off has (at the time of writing) spiked below support at 141.50 now trying to get back above the rising trendline. See the 4 hours chart.
This could be the Exhaustion of the past 6 months strong bull trend in USDJPY, the closing price today will shed more light on that. If closing below 141.50 the top is likely to be in place and a reversal is seems to be a given.
If that scenario plays out selling pressure down to the 0.618 Fibonacci retracement at 136.31 is likely. RSI is showing divergence indicating weakening of the uptrend supporting the trend exhaustion picture.
If buyers come back in and manage to close USDJPY above 145 there could be more upside potential to the strong resistance