**USD/JPY Weekly Technical Outlook (Extended Analysis)**
*Original source: ActionForex.com. This version is a rewritten and extended analysis based on the original article by Action Forex.*
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The USD/JPY pair continued its upward momentum through the past week, pressing higher into levels not seen since 1990. The bullish tone remained firmly intact as traders speculated on diverging monetary policy directions between the US Federal Reserve and the Bank of Japan (BoJ). While the Fed maintains its data-dependent approach with a lingering hawkish bias, the BoJ has shown little urgency in tightening its ultra-loose monetary framework despite a modest rate hike in past months.
With USD/JPY closing above 157.70 and gravitating toward the critical psychological barrier of 160.00, the market tone suggests continued bullish momentum unless a fundamental or geopolitical catalyst emerges. However, traders continue to tread cautiously near intervention levels, recalling Japan’s sudden currency interventions in 2022 when the yen weakened significantly.
This detailed weekly outlook extends technical, fundamental, and sentiment analysis to equip traders with deeper insights for strategic positioning.
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### Current Weekly Performance Summary
– Open: 157.25
– High: 160.14
– Low: 155.59
– Close: 159.80
– Change: +2.55%
USD/JPY registered a strong gain of over 250 pips during this past trading week, powered by strong buying amid a broader US dollar rally. This rise not only reaffirmed the short-to-medium term trends but also cleared previous resistance zones with conviction.
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### Technical Overview
The technical posture for USD/JPY remains firmly bullish across multiple timeframe analyses.
#### Weekly Chart Overview:
– The pair closed well above past resistance at 157.70, confirming a breakout continuation.
– Price action is sitting at its highest level since April 1990, indicating historical significance and overbought sentiment.
– The next psychological and technical hurdle lies at 160.00, a significant round number which also marks a region historically targeted during Japan’s prior FX interventions.
#### Daily Chart Highlights:
– Momentum indicators such as RSI and MACD show bullish tendencies, though signs of divergence are forming. RSI is hovering above 70 level, indicating overbought market conditions.
– Short-term upward channel support comes in near 157.00. A break below that could trigger corrective downside moves, though major structural damage to the bullish trend requires a break below 153.00.
– 20-day and 50-day EMAs pointing sharply north, suggesting sustained buying interest with dips being bought aggressively.
#### Critical Resistance Levels:
– 160.00 – The immediate psychological resistance and a potential intervention trigger level for the BoJ.
– 161.80 – A Fibonacci projection derived from the 140.25 to 151.95 base and projected extension into the current rally.
– 163.00 – Extended Fibonacci and round number resistance.
#### Key Support Zones:
– 157.70 – Prior resistance turned support following this week’s breakout.
– 155.50 – Near-term swing low and important pivot area.
– 153.00 – Structural support that would threaten the bullish outlook if broken.
– 150.00 – Psychological level and a former breakout zone.
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### Elliott Wave Perspective:
The movement since the 127.20 bottom back in 2023 can be interpreted as an impulsive five-wave structure (Elliott Wave Theory), suggesting the current rally may be in its fifth wave.
– Wave 1 initiated the upward impulse from 127.20 to around 145.00.
– Wave 2 led to a retracement toward the 137.00 region.
– Wave 3 extended significantly beyond 152.00.
– Wave 4 correction was shallow and bottomed near 146.50.
– If current wave 5 is unfolding, it may target 163.00 based on 61.8% Fibonacci expansion of waves
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