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  • USD/JPY remains depressed below 108.80 in the early Asian session.
  • Descending trendline from YTD high near 111 remains a strong barrier.
  • Negative momentum oscillator hints at bearish bias.

USD/JPY remains downbeat on Tuesday following the previous day’s subdued price action. The pair failed to hold onto the 109 psychological mark in the previous trading sessions and is expected to continue its slide towards a lower trajectory.

At the time of writing, the USD/JPY pair is trading at 108.79, up  0.03% on the day.

USD/JPY daily chart

On the daily chart, the pair has been trading in a broad descending triangle formation, which is a bearish pattern. The downward sloping line of the formation from the YTD highs of 110.96 (March 31) acts as a strong defense for the bulls.  

The bounce back in price from the lows of 107.47 led to an uptrend that touches the high near 109.78, the level which marks the continuation of the current downfall in the pair.

A decisive break of the lower trend line of the triangle would bring more weakness to the pair, first at the May 11 low near 108.30 and then at the April 27 low at 108.08.

The receding Moving Average Convergence Divergence (MACD) signals further price correction towards the April 26 low at 107.64.

Alternatively, if price makes a sustained move above the previous day’s close at 108.76, then it could bring the possibility of upside price movement near the 50-day Simple Moving Average (SMA) at 109.10.

USD/JPY Additional Levels