USD/JPY technical analysis: Bears likely to aim towards challenging descending trend-channel support

The USD/JPY pair struggled to register any meaningful recovery and remained well within the striking distance of multi-month lows set on Friday.
Near-term oversold conditions on the daily chart seemed to be the only factor lending some support, though the uptick lacked any strong conviction.

Haresh Menghani FXStreet

Looking at a slightly bigger picture, the pair has been trending lower along a short-term descending trend-channel from yearly tops - set on April 24, indicating a well-established near-term bearish trend.

This coupled with the fact that the pair has found acceptance below 61.8% Fibonacci retracement level of the 104.69-112.40 up-move further support prospects for an extension of the bearish trajectory.

A sustained break below the 107.00 handle will add credence to the negative outlook and turn the pair vulnerable to aim towards challenging the trend-channel support, currently near the 106.35 region.

On the flip side, any attempted recovery move might now confront fresh supply near the 108.00 handle ahead of the 108.50-70 resistance – marking 50% Fibo. level and also nearing the trend-channel hurdle.

Only a convincing break through the mentioned confluence barrier might negate the bearish outlook and prompt some aggressive short-covering move, lifting the pair beyond the 109.00 round figure mark.

USD/JPY daily chart

USD/JPY

Overview
Today last price	107.37
Today Daily Change	0.05
Today Daily Change %	0.05
Today daily open	107.32

Trends
Daily SMA20	108.49
Daily SMA50	109.9
Daily SMA100	110.43
Daily SMA200	111.15

Levels
Previous Daily High	107.74
Previous Daily Low	107.04
Previous Weekly High	108.73
Previous Weekly Low	107.04
Previous Monthly High	111.71
Previous Monthly Low	108.23
Daily Fibonacci 38.2%	107.47
Daily Fibonacci 61.8%	107.31
Daily Pivot Point S1	107
Daily Pivot Point S2	106.68
Daily Pivot Point S3	106.31
Daily Pivot Point R1	107.69
Daily Pivot Point R2	108.06
Daily Pivot Point R3	108.38

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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