The USD/JPY currency pair is showing a bearish trend that began on July 3, 2024, and is expected to continue declining toward the 136.50 level. In the short term, the price movement since the March 28, 2025 high is forming a zigzag pattern, according to Elliott Wave analysis.
From the March 28, 2025 high, the decline in wave (A) reached 139.89. This was followed by a corrective wave (B), which also unfolded as a zigzag. Within wave (B), the price rose to 144.03 (wave A), then dipped to 141.95 (wave B). Afterwards, it climbed to 145.90 (wave C), completing wave (B). The pair has since turned lower, starting wave (C).
Wave (C) is currently developing as an impulse pattern in Elliott Wave terms. From the May 2, 2025 high, the price dropped to 143.72 (wave (i)), then rallied to 145.08 (wave (ii)). The decline resumed, reaching 142.34 (wave (iii)). A corrective rally in wave (iv) is believed to have finished at 143.30. The pair is now expected to decline further to complete wave (v). This will finalize wave ((i)) in the larger structure. After this, a corrective rally in wave ((ii)) should occur, partially recovering from the May 2, 2025 high, before the downward trend resumes.
In the near term, as long as the high at 145.90 holds, any upward movements are likely to be limited and fail in a pattern of 3, 7, or 11 swings, leading to further declines.
