• USD/JPY drops to the lowest level in three weeks, down for the fourth consecutive day.
• Downside break of 21-DMA, 61.8% Fibonacci retracement joins bearish MACD signals to favor Yen pair sellers.
• Multiple hurdles to challenge USD/JPY bulls within bullish megaphone pattern.

USD/JPY remains on the back foot for the fourth consecutive day as sellers attack May’s peak below 141.00, down 0.50% intraday near 140.60 heading into Tuesday’s European session.

In doing so, the Yen pair renews a three-week low while extending the previous week’s downside break of the 21-DMA and 61.8% Fibonacci retracement level of October 2022 to January 2023 downside. It’s worth noting that the bearish MACD signals add strength to the downside bias.

With this, the risk-barometer pair appears all-set to break the 140.00 psychological magnet with an aim to test the 50% Fibonacci retracement level surrounding 139.60.

However, the bottom line of a bullish megaphone trend-widening chart pattern comprising levels marked since late March, around 139.00 by the press time, appears a tough nut to crack for the USD/JPY bears.

Following that, the 200-DMA and an ascending support line from January, respectively near 137.20 and 134.90, will be in the spotlight for the Yen pair sellers.

Alternatively, the 61.8% Fibonacci retracement and the 21-DMA, close to 142.50 and 142.75 in that order, restrict the short-term upside of the USD/JPY pair.

More importantly, a horizontal area encompassing multiple levels marked since October 2022, near 145.10-15, appears a tough nut to crack for the USD/JPY bulls.

USD/JPY: Daily chart

Trend: Limited downside expected