JPY/USD – Testing Supply Zone After Short-Term Rally

JPY/USD has recently shown a short-term bullish impulse, breaking out from a narrow consolidation range near 0.00648 – 0.00650. The pair is now approaching a key supply zone around 0.00653, which previously acted as a rejection area on the 1-hour chart.

This current move represents a potential liquidity grab or retest of prior structure before a possible continuation lower. The overall structure remains bearish unless the price can sustain above 0.00654.

Key levels to watch:
Immediate resistance: 0.00653 – 0.00654 (supply zone / short-term rejection area)
Support: 0.00648 – 0.00647 (breakout base)
Next downside target: 0.00644 (previous low / liquidity pool)

Trading strategy:
If price rejects the 0.00653–0.00654 zone with bearish confirmation on the 1H timeframe, sellers may re-enter targeting 0.00647. A clear break below this level could extend momentum toward 0.00644.
However, a confirmed close above 0.00654 would invalidate the short bias and open the path toward 0.00658.

Technical summary:
Bias: Bearish below 0.00654
Setup: Retest of supply zone
Tools used: Supply–demand, breakout-retest, structure analysis

The next few candles will determine whether this is a true breakout reversal or simply a smart-money retracement before continuation downward.
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