USD/JPY Weekly Market Analysis and Forecast
Based on the article by ActionForex.com: “USD/JPY Weekly Outlook”
Original Source: ActionForex – USD/JPY Weekly Outlook (https://www.actionforex.com/technical-outlook/usdjpy-outlook/609175-usd-jpy-weekly-outlook-423/)
Overview
The USD/JPY pair experienced moderate gains over the past week, forming a short-term bottom at 151.86. The pair continued its resurgence, highlighting the prevailing bullish momentum. However, the progress from the recent low appears more like a corrective rebound rather than the initiation of a new uptrend.
Given the underlying pressures and recent macroeconomic developments, the technical structure suggests that the broader uptrend that started around January 2023 is still intact. Yet, any further upside attempts may struggle beyond key resistance points, making the near-term outlook more cautious than outright bullish.
Technical Analysis: Short-Term View
– The pair completed a near-term corrective pullback at 151.86. Since then, buyers have reclaimed control and pushed prices back above short-term moving averages.
– The immediate outlook stays bullish so long as price action remains above the 151.86 threshold.
– A short-term resistance zone appears around 154.76, which aligns with the recent high posted in April.
– A breach beyond this level would potentially revive the medium-term bullish trend and challenge further resistance zones near 156.28.
On the downside:
– The 151.86 level acts as immediate support.
– A sustained break of this support may confirm a deeper correction is underway and could open the way to further declines toward the 148.79 support level, aligned with the 61.8% Fibonacci retracement of the rally from 140.25 to 156.28.
Technical Indicators
– Daily MACD: The MACD (Moving Average Convergence Divergence) line has turned positive, suggesting increasing upward momentum. However, the histogram shows mild divergence, indicating a weakening buying interest in the short term.
– RSI (Relative Strength Index): RSI remains elevated but is below the overbought threshold, implying that the pair has room for further gains before becoming vulnerable to a sell-off.
– Moving Averages: The pair is trading above both the 20-day and 50-day simple moving averages (SMAs), which supports the ongoing bullish structure.
Trend Outlook: Medium to Long-Term Perspective
Looking beyond the immediate short-term rebound, the uptrend that began in 2023 remains intact unless significant technical levels are broken to the downside.
Medium-term structures are defined by the sharp rally that commenced from the 127.21 low in January 2023 and extended all the way to 160.20. While the recent decline from that peak marks a corrective phase, the long-term upward trajectory is supported unless pricing falls below the 140.25 level — a critical swing low established earlier in the current cycle.
Key support and resistance levels include:
Support Levels:
– 151.86 – Short-term corrective floor
– 148.79 – Key medium-term support aligned with Fibonacci levels
– 140.25 – Trend-defining support
Resistance Levels:
– 154.76 – Minor resistance and near-term ceiling
– 156.28 – Extension resistance and a retest of previous highs
– 160.20 – Multi-decade high seen earlier in the year
Weekly Chart Overview
– The weekly candlestick closed with a clear bullish body, signaling that bullish sentiment has re-entered the market after a multi-week pullback.
– Price action confirms the importance of the 151.86 support, treating it as a significant medium-term floor.
– A confirmation above 154.76 could reignite bullish momentum, potentially initiating a new leg higher within the longstanding uptrend.
Fibonacci Analysis
– The recent pullback from 160.20 to 151.86 has retraced approximately 50% of the previous
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