USDJPY Reaches Oversold Levels

The USDJPY pair has experienced a significant decline from its peak of 160.260, with a total drop of 11.40%. This pullback has moved beyond the bullish range that previously pushed the price to its peak. According to the Stochastic indicator, the market is now in oversold territory, signalling potential buying interest at lower levels.

USDJPY Key Levels

• Demand Levels: 142.000, 137.200, 130.000
• Supply Levels: 151.900, 155.370, 160.260

USDJPY Long-term Trend: Bearish

The price recently tested the demand zone at 142.000, causing the Parabolic SAR indicator to shift below the daily candles, suggesting a potential bounce. However, the overall trend remains bearish as the previous swing high of 147.000 has not been breached.

Major swing lows are acting as liquidity zones, attracting large orders. Should the demand level at 142.000 fail to hold, the next significant target would be the swing low at 137.200, which may be a magnet for the price.

USDJPY Long-term Trend: Bullish

On the 4-hour chart, the test of the 142.000 demand zone has led to a Change of Character (ChoCh), indicating possible bullish reversal intentions. For stronger confirmation, traders should look for a similar ChoCh on higher timeframes or a double break of structure to the upside. This could provide more reliable forex signals for a potential shift in market direction.

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