USDJPY currency pair for a long time is moving rapidly to the north as a result of which only this month dollar strengthened against the Japanese yen by 5.58%. The last time such a dynamic movements on the currency pair was observed in June, when there was a strong weakening of the USD -6.70% against the Japanese currency.
Looking at the current situation on the daily chart, we see that yesterday appeared first reaction of the supply which managed to reject a very important resistance zone around 111.25 level.
If this level will be permanently rejected from the technical point of view the potential downward correction could reach the vicinity of the support 107.60 coinciding with the level of 38.2% Fibonacci correction of the entire November increases.
If we look at the chart H1 we observe two essential and most important elements in favor of declines:
- outbreak thru the bottom of the growth channel and the rejection of the trend line after the re-test,
- forming a Head and Shoulders formation, to full confirmation lacks only overcome of the neckline.
