USDJPY has raised through 113.80 before pulling back. Probability remains high for a meaningful top in place or could be in place soon. The currency is expected to drop towards 105.00-106.00 mark going forward. Bears might be inclined to be back in control soon.
USDJPY was structurally into a larger degree corrective phase ((A))-((B))-((C)) since March 2020 lows around 101.18 mark. A push above 111.75 was minimum requirement for the corrective rally to terminate. The pair has pushed through 113.80 levels and might prepare to reverse.
Also note that the above corrective rally is just a part of triangle consolidation of one larger degree. USDJPY needs to drop lower again in a corrective manner towards 105.00-106.00 to complete its triangle structure before the rally could resume higher again.
USDJPY faces immediate price support around 110.80, followed by 109.15, while resistance is above 114.00 levels respectively. If the recent drop from 113.80 is corrective, bulls might push through 114.00 levels to complete the structure.
Traders might be preparing to initiate fresh short positions around 113.114.20 zone, with potential risk above 115.00 and reward below 109.15 going forward. We are watching for the first impulse drop to complete from 113.80 mark.
Finacademy Technical Team
Gold prices dropped through $1773 lows on Thursday before finding support again. The drop from $1793 was in-line with price action of a gartley.
The US dollar index might have carved a lower high around 96.50 mark on Tuesday. The index dropped through 95.80 levels on Wednesday before finding some support.
USDJPY is soon approaching a formidable resistance zone around the 114.40-50 mark. The currency pair has been carving a corrective rally since 112.50 lows.