Technical analysis on USD/JPY for May 23, 2018

We warned that USD/JPY would be vulnerable in case 110.80 is broken. We also warned that the bearish divergence signs were there and bulls should have been cautious. USD/JPY has made a strong reversal and has also broken below the critical support of 110.

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Red line - short-term support

Blue line - medium-term support

The USD/JPY pair has broken below both the support trend lines. Price is now challenging the Ichimoku cloud. Support is next at 109.55. A break below this level will confirm the bearish reversal and we should expect USD/JPY to move at least towards 108-107.50 if not lower. I remain bearish on USD/JPY.

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