After a prolonged downward trend with several impulsive and corrective legs, we see on the 4H chart that the price is following an expanding wedge pattern.
This could continue upwards for some time, maybe up to 109 or 109.200.
If we look at the Dollar Index Chart we see the price has broken the upward channel to the downside and now it is retracing the last large bear candle. The price action is drawing a Harami figure which is a reversal signal, that this Index is so happy to follow as can be seen before on this price channel.
That means we need to wait to see how the DXY price behaves now when it is hitting resistance. If it is keeping strong the likelihood of a reversal to the 98 level grows. That follows USDJPY price could continue its move up to 109.200 or, even 109.700
Conversely, if it weakens it shows that the price action is just a correction of the main downward movement. In that case, we could take also the weakness of the USDJPY as a sign that the new leg down has started.
96.75: The resistance level. Currently, the price is above it. If it moves to the downside it is still acting as resistance level.
96.67 is today’s Open price. If this level is broken to the downside the bearish trend on the DXY continues.
108.7 The top price of the broadening formation may act as resistance. If pierced 109 and 109,200 will be the next resistance levels.
108.45 is the Open of large 4H candle that may act as support. Not good news if a 4H candle closes below it.
107.860 is a level that has rejected the price three times in June. If short, this is a good place to unload positions or close a short-term position.
If pierced, that will probably be the signal of new bearish price movement that may drive the pair to 104.8, the lowest level of 2019. See the chart below.