USD/JPY has plunged in the last days and it has reached fresh new lows. Price has squeezed after yesterday’s massive sell-off.  The rate is trading in the green right now, but this could be only a temporary rebound before the rate will drop again.

However, the rate could decrease again, but personally, I don’t believe that it will approach and reach the 104.65 yesterday’s low very soon.

Technically, it was expected to drop on the short term, but I didn’t expect such a sharp drop. The USD was punished by the USDX’s drop while the Yen has increased in the last period as the Nikkei has plunged and has reached new lows.

You can see that the JP225 has found temporary support at the 18948.6 level, it has tried to bounce back, but we had only a temporary increase and now the rate has dropped again. A further drop will help the Yen to increase further versus all its rivals. We’ll see if the rate will continue to decrease, you should know that a failure to close below the 18948 former low will send the rate higher and the Yen will lose some ground versus its rivals.

Maybe we’ll have a temporary rebound after the massive drop, but as I’ve said, only if the rate will stay above the downside 50% Fibonacci line of the major descending pitchfork and above the former low.

USD/JPY has registered an amazing drop, but it has failed to stay near the 104.65 Thursday’s low and now is trading at 108.50 level. The drop was somehow expected after the failure to stay above the median line (ML) of the ascending pitchfork and after the failure to stabilize above the first warning line (wl1) of the descending pitchfork.

It has decreased as much as 104.65 level and below the first warning line (WL1) of the ascending pitchfork and below the downside 50% Fibonacci line of the descending pitchfork, but it has failed to stay below these levels and now is located much higher, above the upside 50% line of the descending pitchfork and above the 150% Fibonacci line of the ascending pitchfork.

Maybe the rate will decrease a little before it will jump higher again. Personally, I don’t believe that we’ll have a drop below the 104.65 in the upcoming period.