USD/JPY 4H Chart: Rectangle

Rectangles are typical continuation patterns, meaning there exists a high probability of a failure of the US Dollar against the Japanese Yen. Therefore, the pattern seems to only offer a transitory stabilization of the pair before another leg down and the Yen's appreciation. The key zone to watch now is located in between the 113.50 and 113.16 levels, where two moving averages on different time-frames are coinciding with the weekly pivot point. By dropping below here, USD/JPY will pave the way for a loss to 111 in the near-term where the weekly S2 guards February lows. On top of that, daily and weekly indicators are USD-short, and the American currency is also overbought in the SWFX market (71% bullish).