USDJPY is experiencing a downturn today, indicating overall USD softness, and has dropped to its lowest point since September 2024. It broke below a critical swing level at 141.670, which was a support last week, encouraging sellers to target a further decline.
The pair aimed for a swing area between 140.248 and 140.800, incorporating the 61.8% retracement from the January 2023 low, specifically at 140.483. The low today touched 140.480, aligning perfectly with this retracement level, before experiencing a slight upward bounce.
Market Balance
This rebound indicates that buyers are cautiously exploring support at this confluence of technical indicators. Until now, they have seen a small recovery.
To shift the balance in their favour, buyers would need to elevate the price above 141.670 and maintain it. An advance above this mark would change the short-term outlook to a bullish one, prompting sellers to reconsider their strategy.
What we’ve seen today in USDJPY is not just a fleeting dip—it marks a break beneath a previously respected level, shaking out those clinging to a stronger dollar. That 141.670 level acted as a bit of a line in the sand over recent sessions. It was tested and held last week, but sellers have now taken control and forced a meaningful drop through it. The reaction tells us exactly where market intent sits: lower, at least for now.
We dipped straight into that next key zone, nestled between 140.248 and 140.800. That isn’t just some arbitrary patch of price action—we’re eyeing multiple technical confluences there. That 61.8% retracement from a much longer swing—the one that began at the turn of 2023—is sitting precisely at 140.483. And wouldn’t you know it, today’s low lands right on top of that. For those of us watching where money gathers around clear, clean levels, this is no coincidence.
Price Movement
The mild bounce off that point isn’t a reversal signal yet. It tends to suggest buyers are testing the waters, not rushing in. A pause here makes decent sense—those who exited shorts into that level have likely taken profits, and fresh entrants might be hesitant to chase lower without more confirmation.
Yet we must be wary of assuming a base is forming just because price is hovering obediently near such structured support. For momentum to tilt back up, the former support at 141.670 must be taken back decisively—and held. That isn’t simply a suggestion of technical balance; it would force short-side participants to acknowledge a shift, likely fuelling further movement through stop-driven continuation.
So, the near-term picture is one of soft pressure grinding lower. Until price can push and sustain above that former shelf, any strength is likely to be met with offers from those positioning into trend alignment. We got the move down through the critical zone; now, it’s a matter of how far sellers are willing to press and when buyers show they can do more than just hold a level.
As we interpret the current structure, volatility cluster zones around the aforementioned levels should remain relevant for capturing premium and guiding again where liquidity might react. We continue to monitor these touchpoints, watching for whether volume steps in or exhaustion becomes evident. Price is working, and it’s telling us plenty.
