Title: USD/JPY Mid-Day Outlook – May 17, 2024
Source: Adapted from Action Forex
Original Author: ActionForex.com
Overview:
The USD/JPY currency pair remains relatively stable during mid-day trading on May 17, 2024. Price action reflects a cautious tone by market participants, as the pair continues to consolidate within a near-term range. Investors are weighing economic data releases and central bank policies, particularly from the Federal Reserve and the Bank of Japan (BoJ), as they reassess interest rate expectations. Today’s outlook highlights technical levels, price dynamics, and the broader macroeconomic context impacting the US dollar against the Japanese yen.
Current Technical Setup:
– USD/JPY is trading in a narrow consolidation range following its recent recovery above the 154.00 level.
– The pair is currently holding above key support at 153.59 after pulling back from the 156.77 resistance hit earlier.
– The overall trend structure remains bullish on both lower and higher timeframes as long as the support at 153.59 holds.
– Immediate bias is neutral in the short-term, pending a confirmed breakout from the current range.
Intraday Price Action:
– USD/JPY began the day trading slightly lower, reflecting a minor pullback in the US dollar across major pairs.
– The pair has been responding to swings in US Treasury yields which remain a dominant catalyst in driving USD strength or weakness.
– A continuation above 156.78 would resume the broader upward trend and could signal a push towards the next swing high around 160.20.
– On the downside, a break below 153.59 would suggest the start of a larger correction phase, possibly revisiting 151.86 or even lower supports.
Short-Term Outlook:
– As it stands, the USD/JPY remains confined in a consolidation corridor, supported by bullish momentum on the broader trend.
– Short-term indicators are mixed, with the pair hovering near a midpoint between support and resistance.
– Breakout confirmation is required to determine the next directional move.
– Near-term bias remains neutral, with a tilt towards the upside while 153.59 support holds.
Key Technical Levels:
Support:
– 153.59 – Immediate key support and a line that guards against a potential retracement.
– 151.86 – A previous low that could act as the next level of defense if 153.59 fails.
– 150.00 – Psychological round number that could attract significant buying interest in the event of a decline.
Resistance:
– 156.78 – Immediate resistance zone seen at the most recent swing high.
– 160.20 – A prospective target if bullish momentum resumes.
– 162.00 – Long-term resistance level near historical highs.
Medium-Term Evaluation:
– In the bigger picture, USD/JPY maintains an overall bullish configuration on the daily and weekly charts.
– The recent consolidation at higher levels could be seen as a base-building process before another leg higher.
– Support from rising trend lines and moving averages continues to underpin the broader rally.
– The pair remains above both the 50-day and 200-day simple moving averages, indicating robust bullish sentiment in the medium term.
Fibonacci Analysis:
– The upward leg from 140.24 to 156.78 represents a strong bullish impulse.
– A retracement to around 151.86 would represent a 38.2% Fibonacci pullback from this impulse.
– Deeper correction toward 148.51 would constitute a 61.8% retracement and align with a broken resistance-turned-support zone.
– Maintaining price above the 153.59 level keeps the correction shallow and favors continuation upward.
MACD and RSI Indicators:
– RSI (Relative Strength Index) on the 4-hour and daily chart is neutral to slightly bullish, hovering around the 55–60 zone.
– Daily MACD has flattened but is showing signs of resuming positive momentum.
– Both indicators support consolidation with a potential
Explore this further here: USD/JPY trading.