USDJPY bulls have not given up yet

The USDJPY currency pair (nickname “the Yen”) on the H4 time frame was in a downtrend until 2 December, when a last lower bottom was recorded at 133.611.

After the bottom at 133.611, the market broke through the 15 and 34 Simple Moving Averages and the Momentum Oscillator broke the 100 baseline into bullish terrain. A possible shift in the market momentum from bearish to bullish was further confirmed with many strong bullish candles driving the price significantly higher to make a higher top.

A possible critical resistance level was formed at a higher top that was reached on 7 December at 137.847. The bears then tried their best to dominate the market again but failed when a higher bottom formed later in the same session at 136.261.

If the Yen manages to break through the critical resistance level at 137.847, then three possible price targets can be considered from there. Attaching the Fibonacci tool to the higher top at 137.847 and dragging it to the support level near the 34 Simple Moving Average at 136.261, the following targets can be calculated. The first target is estimated at 138.827 (161.8%). The second price target can be forecast at 140.413 (261.8%) and the third and final target might be anticipated at 142.979 (423.6%).

If the support level at 136.261 is broken, the above scenario is no longer valid.