Today on USDJPY – Daily and H4 charts support Short trades, but...

On the Daily chart above, yesterday, we decided to go with the bears; however, we identified the most recent Daily swing low @ 90.06 (which we've highlighted using the lower blue broken line) as the next critical support level where we expect the bears’ resolve to be tested. By the end of yesterday, price had travelled over 100 pips downward; and earlier today, it continued its southward move toward the critical 90.06 support. Currently, price has halted its downward move @ 90.23 – less than 20 pips away from 90.06. There’s a possibility we are already in the bulls’ zone: we might experience a strong or weak bullish retracement. In the case of weak retracement, we should still have the opportunity to seek Short trades today, but a strong retracement would most likely prevent any Short trade opportunity. In all, our bias is still bearish, but, depending on what price eventually tells us, from a day-trade perspective, we might have to exercise patience in seeking our Short trades, and that might mean not trading the USDJPY pair today.

On the H4 chart above, same as yesterday, the swing low @ 91.56 (which we’ve highlighted using the upper blue broken line) remains the most recent swing low that price broke below. That automatically sustains our bias in favor of a downward price move. As we could see, price moved downward, close to the 90.06 support level (the lower blue broken line) – leaving less than 20-pip gap in-between. Again, based on current price-bottom’s proximity to the 90.06 level, we might experience a strong or weak bullish retracement.
The white horizontal line @ 92.17 highlights the most recent swing high, and as long as price stays below it – in the absence of any new and lower swing high – our bearish or downward bias remains intact.

However, we still need our Hourly charts – using Fibonacci retracement levels and important resistance levels – to seek promising areas to take our Short positions. Price pattern on the Hourly must also be forming lower highs and lower lows. Please note that our aim is to sell a rally in today’s down-trend.

Also, PATIENCE is the key here: we need to patiently wait for the Hourly retracement. It might happen, and it might not.