The US dollar lost ground against the yen last week, as the news that President Trump had tested positive for COVID-19 caused traders to move into the safety of the yen currency.
USD/JPY analysis shows that 105.55 level is the key technical area to watch this week.
USD/JPY medium-term price trend
The USD/JPY pair is at risk of turning lower this week, following a heavy technical rejection from a key technical.
USD/JPY technical analysis shows that failure to overcome the 105.55 level could cause heavy technical selling.
The daily time frame shows that the USD/JPY pair started to move back inside a symmetrical triangle pattern, and then suffered a heavy technical rejection.
Failure to move price back inside the mentioned symmetrical triangle pattern this week could cause the USD/JPY pair to fall back towards the September monthly low, and possibly the 103.00 level.
If buyers can gain traction above the 105.55 level, then further upside advancement towards the 106.00, and possibly the 106.40 level remains possible.
USD/JPY short-term price trend
USD/JPY technical analysis highlights that the pair has a bearish short-term bias while the price trades under 105.20.
The one-hour time frame shows that a bearish head-and-shoulders pattern has formed, following the recent reversal from the 105.80 area.
Technical analysis highlights that the pair could fall towards the 104.60, if the price moves below the neckline of the head-and-shoulders pattern, around the 105.20 level.
If the price moves above 105.80 then a counter-rally towards the 106.40 level seems likely.
USD/JPY technical summary
USD/JPY analysis shows that the pair has suffered a heavy rejection from a key former breakout area. Failure to recover back above the 105.55 level could cause further selling.