FX.co ★ USDJPY reaches our next target of 106.70

USDJPY remains in a bullish trend. Price has reached the upper channel boundary at 106.70 which was our target that we mentioned in our previous post. The RSI continues to provide a warning to bulls as it was not able to make higher highs.

Red line- bearish divergence

USDJPY is near the channel resistance. At current levels I prefer to be neutral and take any bullish profits. The RSI is providing a bearish divergence and I expect price to make another pull back lower. This divergence by the RSI is just a warning and not a reversal sign. So far price continues making higher highs and higher lows.

Concluding, having rallied from 104.92 to 106.70, USDJPY is now at a point where bulls need to be very cautious as a pull back is imminent.