• USD/JPY takes offers to refresh intraday low during a two-day pullback from monthly high.
• Fortnight-old ascending trend line, 61.8% Fibonacci retracement level limit further declines.
• 200-SMA, five-week-long horizontal support appears a tough nut to crack for bears.
• Monthly high guards recovery moves ahead of July’s peak.

USD/JPY portrays a two-day downtrend, after refreshing the monthly peak, as it refreshes the daily low around 136.35 heading into Wednesday’s European session.

In doing so, the yen pair traces the pullback in RSI (14) and the bearish MACD signals to keep intraday sellers hopeful.

However, an upward sloping support line from August 11, near 136.15, restricts the immediate downside of the pair.

Following that, the 61.8% Fibonacci retracement level of the July-August south-run, near the 136.00 threshold.

It’s worth noting, however, that a convergence of the 200-SMA and a horizontal area comprising multiple levels marked since July 22, around 135.60-70, seems the notable challenge for USD/JPY bears.

Meanwhile, recovery moves may initially aim for the daily high surrounding the 137.00 round figure before challenging the monthly peak marked the previous day near 137.65.

In a  case where USD/JPY bulls keep reins past 137.65, the late July swing high near 138.90 and the previous monthly top near 139.40 could probe buyers targeting the 140.00 psychological magnet.

USD/JPY: Four-hour chart

Trend: Recovery expected