USD/JPY Price Forecast: Hammer teases rebound after 650-pip slide

The USD/JPY continued to fall for the second straight day, losing 0.40%, but found support around 153.00, with the pair set to end the session at around 153.75.

USD/JPY Price Forecast: Technical Outlook

Since September 2, USD/JPY has fallen over 4% (650 pips) and even hit a nearly seven-month low of 152.89 before reclaiming the 153.70 mark, which appears to be a hammer formation. This candlestick is usually bullish, but a daily close above the high of the day (HOD) of 154.42 is needed before challenging higher prices.

In that case, the 155.00 milestone will be next, followed by the 200-day Simple Moving Average (SMA) at 158.45. Up next is 160.00.

The Relative Strength Index (RSI) is oversold, but given the velocity of the move, USD/JPY could fall further. However, if the RSI pierces above the 30 level, the pair could regain some ground.

On the other hand, if bears stepped in and cleared 153.00, they could test the yearly low of 152.10 hit on January 27.

USD/JPY Price Chart – Daily