USDJPY remains under pressure and risk is still to the downside as prices continue to drift lower from the 140.00 psychological level and are hovering around the 38.2% Fibonacci retracement level of the down leg from 105.65 to 102.60 at 103.77. The short-term technical indicators are pointing to more weakness in the market.
Looking at the 4-hour chart, the price is looking capped by the 20 and 40-period simple moving averages (SMAs), while the MACD and the RSI are flattening near the zero level and the 50 line respectively.
The next target to the downside is the 103.55 support. At this stage the market would likely see a resumption of the downtrend touching the 23.6% Fibonacci of 103.32 before heading towards the ten-month low of 102.60.
Upside moves are likely to find resistance at the 40-period SMA at 103.90. There is an important resistance zone between the 50.0% Fibonacci of 104.13 and the 104.20 barrier. Rising above this area would help shift the focus to the upside towards 104.40 and the 61.8% Fibonacci of 104.50.
In the short-term, the bearish phase remains in play especially if USDJPY continues to trade below 104.00. In the bigger picture, the market has been strongly negative since June 2020.
