USD/JPY Price Analysis: Descending trend-channel points to further near-term weakness

• USD/JPY pair’s attempted recovery move faltered near a short-term descending trend-channel.
• The near-term technical set-up support prospects for a further decline towards the 106.00 mark.

The USD/JPY pair failed to capitalize on its attempted intraday recovery move and faced rejection near the top end of a short-term descending trend-channel formation on hourly charts.

The pair slipped into the negative territory, albeit lacked any strong follow-through selling and so far, has managed to hold well above six-week lows set in the previous session.

The pair's inability to register any meaningful recovery suggests that the near-term bearish pressure might still be far from being over amid sustained selling around the greenback.

The bearish outlook is reinforced by the fact that oscillators on the daily chart have been gaining negative traction and recovered from the oversold territory on the 1-hourly chart.

Hence, an eventual slide below the overnight low, around the 106.35 region, and a subsequent fall to the trend-channel support, near the 106.00 mark, now looks a distinct possibility.

On the flip side, recovery attempts might now confront some fresh supply near the trend-channel resistance, around the 106.70 region, and remained capped below the 107.00 level.

USD/JPY 1-hourly chart

Technical levels to watch