USDJPY 4-Hour Technical Analysis (Smart Money Concept Breakdown)

📈 Overall Market Structure Overview:
The chart reflects a multi-phase Smart Money playbook, consisting of:

Bullish channel structure

Breakout followed by liquidity sweep

Supply zone flip to demand

Price mitigation and structure shift

Anticipated reaction zone for upcoming move

🔎 Phase-by-Phase Analysis:
🧱 1. Ascending Channel Formation
Price was moving upward in a controlled bullish ascending channel, suggesting institutional accumulation with planned distribution above highs.

The channel breakout was the first significant liquidity event, where early breakout traders were baited.

💧 2. Fakeout and Supply Interchange into Demand (Ellipse Zone)
Once the channel broke, price sharply reversed, retracing into a previous supply zone.

However, institutions defended this zone, flipping it into a demand area.

This behavior, marked with the blue ellipse, signals “Supply Interchange in Demand” – a core SMC concept.

Here, orders were absorbed

Liquidity was trapped below

A bullish push confirmed institutional intent

🎯 3. Previous Target Hit – Completion of Bullish Leg
Price made a strong rally from the demand zone, hitting the previous target near 147–148 zone.

This bullish leg created a Major Break of Structure (BOS) confirming bullish dominance at that phase.

⚠️ 4. Distribution Begins: Shift in Momentum
After reaching the Major BOS area, price failed to hold higher levels.

A decline followed, indicating distribution by smart money.

The reaction was sharp and consistent, creating lower highs, signaling weakness.

🔄 5. Minor CHoCH Formation – Early Reversal Signal
A Minor Change of Character (CHoCH) occurred around the 144.000–143.000 area.

This is a key transition, where smart money transitions from bullish intent to potential bearish delivery.

📦 6. Next Target Zone – Bullish POI (Point of Interest)
The chart identifies a next target demand zone around 141.800–141.200, marked in green.

This zone:

Holds unmitigated demand

Sits below a recent liquidity pool

Aligns with past support

This is where Smart Money could re-enter, offering a long opportunity if a bullish CHoCH or BOS forms from that zone.

📊 Trade Scenarios & Forecast:
🔻 Bearish Short-Term Play (Sell Setup):
If price respects current resistance (144.500–145), and a lower high forms:

Short entry opportunity

Target: 142.000–141.200 demand zone

Confirmation: Strong bearish candle, CHoCH below minor support

🔺 Bullish Reversal Play (Buy Setup):
At the demand zone:

Look for bullish reaction + CHoCH or BOS

Long entry potential

Target: Retest of 144.000 or even 147.000 if liquidity allows

🔐 Smart Money Tactics in Play:
Liquidity Engineering:

Price trapped both bulls (at highs) and bears (below ellipse zone)

Supply into Demand Flip:

A classic trap where supply becomes a launchpad for bullish delivery

Minor CHoCH:

Early signal of intent change

Next POI (Point of Interest):

Potential reaccumulation zone below major liquidity grab

🧠 Educational Takeaway:
This analysis illustrates:

Why breakouts are often traps without confirmation

How to identify real institutional zones

The role of CHoCH/BOS in planning ahead

Importance of waiting for price to come to your levels, not chasing

⚠️ Risk & Caution:
News catalysts can cause deviation from technical levels

Always use stop loss and proper risk management

SMC is about patience and precision, not prediction

✅ Summary:
USDJPY is showing early signs of a smart money distribution and a potential pullback toward demand.
Watch closely for confirmation at the key zone (141.800–141.200) before engaging long. Until then, short setups on rallies may be favorable.