Title: USD/JPY Breaks Key Bullish Trend Line: Technical Outlook and Market Implications
Original Analysis by Economies.com – November 7, 2025
Rewritten and Extended Version
The USD/JPY currency pair has recently broken through a critical support level that had previously upheld the pair’s bullish momentum. This development signals a potential shift in market sentiment and prompts traders to re-evaluate their technical outlook on the pair.
The breach of the main ascending trend line is particularly significant, as it could reflect a turning point for the U.S. dollar against the Japanese yen. This article will analyze the current technical structures, detail recent price action, provide potential scenarios for both bearish and bullish trends, and explore key economic factors likely to influence the pair in the days and weeks ahead.
Overview of the Breakout
In recent trading sessions, the USD/JPY pair has decisively broken below a primary upward trend line that had supported bullish price dynamics for an extended period. This trend line had been serving as a confirmation of bullish momentum since the beginning of the second quarter of 2025. However, a downturn below this line had effectively ended this bullish run, setting the stage for potential corrective price action.
Key Observations:
– The pair breached the rising major trend line drawn from the lows of April 2025.
– This line had served as a dynamic support level and the basis for the longer-term uptrend.
– With the pair now positioned below this trend line, selling pressure is increasing.
– Momentum indicators such as the Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) also reflect possible downside continuation.
– The pair has already started forming lower highs and lower lows on intraday charts.
Technical Analysis: Chart Patterns and Indicators
A breakdown on such a significant trend line typically implies a change in trend sentiment. Below is a detailed technical review of the current price action and associated indicators:
1. Trend Line Violation:
– The bullish trend line, which had connected a series of ascending lows dating back several months, was broken during the November 6th trading session.
– The breach has been followed by a move that has remained below this line, confirming the technical breakdown rather than a false breakout.
2. Immediate Support and Resistance Levels:
– Following the drop, immediate support is observed near the 149.50 level.
– A break below this support can expose the 148.30 and then the major swing low near 146.80.
– To the upside, the first resistance now lies at the broken trend line itself, which has turned into a resistance zone around 151.20.
– A daily close above 151.20 would be required to invalidate the bearish scenario and bring the bulls back into control.
3. Momentum Indicators:
– RSI: The daily RSI has dropped below the neutral line (50), indicating increasing downside momentum.
– MACD: The MACD histogram has crossed into negative territory, while its signal line has formed a bearish crossover, confirming selling strength.
4. Candlestick Formations:
– The weekly chart has formed a bearish engulfing pattern, potentially signaling an extended correction.
– Daily price action on November 6th formed a long-bodied bearish candle, confirming seller dominance at the current levels.
Potential Market Scenarios
Scenario 1: Continued Bearish Momentum
If the selling pressure continues and the USD/JPY fails to return above the broken trend line, the pair may establish a new downward trend. This scenario would likely gain further confirmation with additional breaks below key support levels.
Key indications of this scenario include:
– Increased volume on downside moves.
– Failure to reclaim the broken support near 151.20.
– Sustained bearish structure with lower highs and lower lows.
Downside Targets:
– 149.50: A psychological and technical support level.
– 148.30: Previous swing low.
– 146.80: Medium-term Fibonacci
Explore this further here: USD/JPY trading.