Title: USD/JPY Mid-Day Technical Analysis and Outlook
Original Article by ActionForex Technical Analysis Team
Source: https://www.actionforex.com/technical-outlook/usdjpy-outlook/610479-usd-jpy-mid-day-outlook-2150/
Overview
The USD/JPY currency pair is showing signs of renewed momentum, driven primarily by broad U.S. dollar strength and rising Treasury yields. Technical indicators point to a continuation of the uptrend, with near-term support levels establishing a solid foundation for potential gains. Traders are closely watching for the re-test and possibility of breaching multi-month highs. This mid-day technical review explores price action, support and resistance levels, and possible near-term and longer-term directional moves.
Current Market Conditions
As of mid-day trading, the USD/JPY pair is holding firm following a short phase of consolidation. The pair has bounced from prior support and approached the upper levels seen in April, demonstrating bullish sentiment from the market participants. The U.S. dollar has gained strength globally following yet another boost in Treasury yields, offering buyers an incentive to engage in further long positions.
– Current price action is showing sustained upward pressure
– Breakout from minor consolidation suggests momentum is favoring bulls
– USD continues to outperform while the yen remains under pressure amidst policy divergence
– U.S. Treasury yields are rising, supporting dollar appreciation
Short-Term Technical Outlook
The immediate outlook for USD/JPY suggests that the current upswing may resume soon if present conditions persist. Price action and reaction near resistance pivot levels will be the key determinant for near-term price direction.
Key Technical Factors:
– The pair is trading above key short-term and medium-term exponential moving averages, indicating a continued bullish trend
– RSI (Relative Strength Index) is staying upward and has not yet reached overbought territory, suggesting room for additional upside
– The pair has broken out of a minor corrective phase, signaling bullish continuation
– Momentum indicators continue to support further gains
Support and Resistance Levels:
– Immediate resistance lies at 157.70, a level that capped gains during the most recent upswing
– A firm break above 157.70 should bring the next round of resistance at 160.20 into focus
– On the downside, immediate support is situated near 155.50
– Stronger support can be seen at the 152.90-153.20 range, which has acted as a floor in previous pullbacks
– If a deeper correction occurs, the 150.00 level would serve as a psychological support zone
Trading Bias and Expectations
The near-term trading bias remains bullish as long as the 155.50 support level remains intact. Price action is showing higher lows and higher highs, consistent with a healthy uptrend. As long as this structure holds, traders are likely to view pullbacks as opportunities to re-enter the market.
– Upside scenario: Sustained staying power above 157.70 would confirm resumption of the upward trend and pave the way for further testing of the 160.00 handle
– Downside risk: A break below 155.50 would increase vulnerability to a deeper correction, and a drop under 152.90 could signal potential trend exhaustion
– Neutral scenario: If price remains range-bound between 155.50 and 157.70, then the currency pair could pause in consolidation before the next directional move
Medium-Term Technical Picture
Zooming out to the daily and weekly timeframes, the bullish bias remains supported. The structure is consistent with a medium-term ascending trend that began in early 2024. This trend has remained largely uninterrupted, with only minor corrective dips that have found robust buyer interest.
– The pair is posting higher monthly closes
– Weekly candlesticks show strong buying pressure with limited significant retracements
– Medium-term resistance is identified near the 160.20 high recorded in April, which aligns closely with a long-term Fibonacci extension
– Sustained break above
Explore this further here: USD/JPY trading.