**USD/JPY Mid-Day Outlook (Original Analysis by ActionForex.com)**
*Source: ActionForex.com – “USD/JPY Mid-Day Outlook”*
The USD/JPY currency pair continues to demonstrate a strong bullish bias at mid-day trading. The trajectory for the pair reinforces expectations of further upward movement, supported by robust technical indicators and broader macroeconomic trends. In this article, we break down the current price action, technical levels, momentum signals, and the broader outlook for traders and investors interested in this major currency pair.
### Current Technical Overview
– USD/JPY remains resilient and holds firmly in a positive trajectory.
– The pair is currently extending gains from a previous low of 160.20.
– The intraday bias remains on the upside as bullish momentum drives it higher.
– The recent retracement from higher levels appears to have been well-supported above the 160.00 key support mark.
### Key Resistance and Support Levels
– Immediate resistance is seen around the 161.80 Fibonacci extension level.
– A break through this level can set the stage for a test of 162.42, which represents a critical short-term resistance.
– Further breakout above 162.42 would open up more aggressive bullish positions targeting intermediate resistance zones above the 163.00 handle.
Key support on the downside is observed at:
– 160.20, which previously acted as a pivot for bullish reversal.
– A decisive break below this level will intensify intra-day selling pressure.
– Stronger support lies at 159.77, which represents a key short-term low prior to the recent upside correction.
– Failure to sustain above these support levels can shift the bias temporarily to the negative zone, targeting 158.23.
### Momentum Indicators
– The 4-hour MACD (Moving Average Convergence Divergence) remains in positive territory, implying bullish momentum is still firmly in control.
– RSI (Relative Strength Index) is above the midpoint level, although not in overbought territory, suggesting there is still room for further upside.
– Daily MACD also maintains a steady positive slope, reinforcing the overall upward momentum in place.
– Bollinger Bands are widening, typically a sign of increased price volatility but often associated with continuation of trend rather than reversal.
### Daily Chart Interpretation
On the daily chart, USD/JPY exhibits classic signs of a bullish continuation:
– The pair is riding on the strength of a rebound initiated from 151.86.
– Price action is holding above the 20-day and 50-day exponential moving averages, with the 20-day EMA acting as a dynamic short-term support trend line.
– The setup from previous highs and lows continues to reflect higher highs and higher lows, a configuration commonly associated with upward continuation in price action.
– Ichimoku Cloud model also supports the bullish case; price remains well-above the Kumo (cloud), and the Tenkan-Sen line is above the Kijun-Sen, both of which signify steep short- and medium-term momentum.
### Broader Technical Picture
Stepping back to the weekly and monthly charts, the strength in USD/JPY is part of a larger trend that has been in place since early 2021:
– The pair bottomed out in January 2021 after a prolonged downtrend and began showing patterns of accumulation and uptrend formation.
– Since then, each higher time frame continues to post higher highs with successive breakouts from consolidation zones.
– Key Fibonacci targets from the 2021-2022 rally continue to offer predictable resistance and support levels, all of which have been consistently respected by price action.
In terms of broader structure:
– A long-term upward trend line originating from the January 2021 lows continues to guide the price higher.
– This trend line provides structural support and traders may find opportunities on dips provided that bullish confirmations are in place.
– The long-term bullish picture is further validated by interest rate differentials between the US and Japan, and policy divergence from
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