Today’s technical analysis focuses on USD/JPY, which currently presents a promising buy setup on the H1 chart.
The broader structure is clearly bullish. Price is moving in a well-defined uptrend supported by a green ascending trendline. This trendline has already been tested several times and continues to act as a reliable dynamic support.
Within this uptrend, we can identify three corrective phases. The first two corrections ended with strong bullish reversals after the price broke above the red resistance lines that capped those pullbacks. Each breakout triggered a continuation of the uptrend.
Now we are observing a very similar situation during the third correction. After bouncing from the green uptrend line, price is breaking above the red resistance that defined the most recent consolidation. This breakout signals renewed buying pressure.
In addition to the trendline support and resistance breakout, price also reacted from a yellow horizontal support area. This creates a confluence of bullish signals, strengthening the overall positive outlook.
As long as the pair holds above the recent support area, sentiment remains positive and the structure favors further upside.
The bullish scenario would be invalidated if price breaks below today’s lows established during the Asian session. Such a move would cancel the current setup and generate a sell signal instead.