USD/JPY Price Analysis: Inches closer to 130.70 support during three-day downtrend

• USD/JPY takes offers to refresh intraday low, drops for the third consecutive day.
• Clear U-turn from the key DMAs, unimpressive oscillators keep sellers hopeful.
• Ascending trend line from mid-January lures bears; bulls remain off the table below 134.00.

USD/JPY takes offers to refresh the intraday low near 131.40 as Tokyo opens on Wednesday. In doing so, the yen pair drops for the third consecutive day after reversing from the 100-DMA during the last week.

Not only the U-turn from the 100-DMA but a following downturn past convergence of the 50-DMA and 23.6% Fibonacci retracement level of its October 2022 to January 2023 fall, around 133.05 at the latest, also keep USD/JPY bears hopeful.

Adding strength to the downside bias is the steady RSI (14) and sluggish MACD signals.

However, the RSI level is below the 50 mark and hence suggests the dip-buying, which in turn highlights an upward-sloping support line from January 16, close to 130.70 at the key level to watch for the USD/JPY bears.

Should the quote drop below 130.70, the odds of witnessing a break of the 13.0.00 psychological magnet can’t be ruled out.

Alternatively, the aforementioned resistance confluence of around 133.05, comprising 50-DMA and 23.6% Fibonacci retracement, restricts short-term advances of the USD/JPY pair.

Following that, the 100-DMA and a downward-sloping trend line from late October 2022, respectively near 133.65 and 135.00 in that order, could challenge the Yen pair buyers.

It’s worth noting, however, that the USD/JPY run-up beyond 135.00 won’t hesitate to challenge the Year-To-Date (YTD) high surrounding 137.90.

USD/JPY: Daily chart

Trend: Further downside expected