USD/JPY: Break below 148.80 could trigger deeper pullback – SocGen

USD/JPY extends rebound above 150. Economists at Société Générale analyze the pair’s outlook. 

Possibly forming double top

USD/JPY recently faced stiff resistance near 151.70/152 as it failed to overcome the high of 2022. This denotes formation of a possible double top. Daily MACD has been posting negative divergence since July denoting receding momentum.

151.70/152 is likely to remain an important hurdle near term.

A price break i.e., a move below recent pivot low at 148.80 could mean a deeper decline. This can lead the pair lower towards 147.30 and 145.90/145.10, the 23.6% retracement from January.