USD/JPY (a 4-hour chart)
There was a predominance of bearish sentiment and long positions profit taking in the US and the Japanese stock market. Investors closed their carry trade transactions which creates a demand for the Japanese yen as a funding currency.
In this connection, we expect the price lowering. Still the bulls can take the initiative in their hands against the background of positive dynamics in the debt market. The level of 123.50 breakthrough served as a downward reversal correction signal.
The price is finding the first support at 123.50, the next one is at 122.40. The price is finding the first resistance at 124.30, the next one is at 125.50.
The price is in the Cloud and it is under the Chinkou Span. The Tenkan-sen and the Kijun-sen show a horizontal movement and form a “Golden Cross”.
The MACD indicator is in a positive territory. The price is correcting.
If the price fixates below the support 123.50, it may continue the downward trend in the short term. The potential targets are 122.40 and 121.60.