USDJPY Daily Analysis – July 5, 2023

USDJPY, which had been displaying a notable uptrend from its low of 138.42, has encountered a significant development as it broke below the rising price channel on the 4-hour chart. This suggests that the pair may require a period of lengthier consolidation before resuming its upward movement. Consequently, deeper declines are expected in the coming days, with the next target being the support level at 142.67.

The break below the rising price channel indicates a temporary shift in the market sentiment for USDJPY. Traders will be closely monitoring the price action to determine the extent and duration of the consolidation phase. It is important to note that during consolidation, price movements can become range-bound and less directional, requiring traders to adjust their strategies accordingly.

On the upside, the resistance level at 145.06 will now serve as a key hurdle for USDJPY. Only a decisive break above this level would suggest a resumption of the previous uptrend, potentially leading to further gains towards the targets of 146.40 and 149.00. However, until such a breakout occurs, the focus remains on the consolidation phase and the support level at 142.67.

In summary, USDJPY has broken below the rising price channel, indicating a need for lengthier consolidation. Deeper declines are expected, with the next target at 142.67 support. The resistance level at 145.06 will serve as a significant barrier, and a break above this level would signal a resumption of the uptrend. Traders should closely monitor price movements and adjust their strategies accordingly, considering key levels and fundamental factors that can impact the currency pair.