*Disclaimer: The following article is a rewritten and expanded version based on the original analysis by ActionForex.com titled “USD/JPY Weekly Outlook.” Full credit goes to ActionForex.com and the original author for the foundational insights. The content has been reformatted and extended for educational and informational purposes.*
# USD/JPY Weekly Outlook: Technical Review and Forward Guidance
The USD/JPY currency pair experienced notable movements over the past week, reflecting key interactions between monetary policy expectations, economic data releases, and broader geopolitical sentiment. As of the latest weekly close, the pair shows signs of range consolidation following a strong bullish trend that has dominated recent months.
This technical review and forward-looking outlook will delve into the current chart structure, key technical indicators, support and resistance levels, and broader market drivers impacting the pair. A comprehensive analysis will provide forex traders and investors with a clearer understanding of what to watch for in the coming sessions.
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## Weekly Recap: Bullish Bias Amid Pullback
– USD/JPY opened the week near the top of its multi-month bullish channel but failed to sustain upside momentum above 158.00.
– The pair pulled back slightly, signaling short-term exhaustion as it approached key resistance.
– Weekly close held above the 20-day EMA and maintained support around 155.00 levels, suggesting a continuation of bullish structure for now.
The overall bias remains tilted upward, supported by monetary policy divergence between the Bank of Japan (BoJ) and the Federal Reserve. However, signs of consolidation suggest an increasing tug-of-war between bulls and bears ahead of major data and central bank meetings.
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## Technical Structure and Chart Setup (Weekly Timeframe)
### Price Action:
– Price tested a high near 158.00 and failed to break higher but sustained levels above the 20-EMA.
– The pair shows consistent higher highs and higher lows since early January 2024, clearly aligning with a bullish trend.
– The recent pullback has been shallow, indicating underlying strength in the market.
### Moving Averages:
– The 20-week EMA continues to act as reliable dynamic support, currently situated around the 153.00 level.
– The 50- and 100-week EMAs have maintained an upward slope and are positioned far below current price action, confirming bullish market sentiment in the medium term.
### RSI & Momentum:
– Weekly RSI hovers just below overbought territory (70), currently around the 66-68 range.
– No major bearish divergence spotted yet, suggesting room for further tracking upward if sentiment improves.
– Momentum indicators such as MACD show continuation, with the MACD line above the signal and histogram bars remaining positive.
### Fibonacci Levels:
– The current advance from the 140.00 region to recent highs of 158.00 aligns with well-respected Fibonacci retracement zones.
– A retracement towards the 154.00–155.00 region would constitute a re-test of 23.6% Fib support from the January bullish leg.
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## Short-Term Pullback or Medium-Term Consolidation?
While the trend remains bullish, a potential short-term consolidation phase may unfold as buyers digest recent gains and assess inflation data and central bank signals.
Traders should closely monitor:
– Whether price action respects the 155.00–154.00 support zone, indicating dip-buying interest.
– Reaction at resistance near 158.00 and possible extension toward 160.00.
– Break below the 153.00 handle would hint at deeper corrections toward 150.00 psychological support.
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## Key Support and Resistance Levels
Below is a consolidated technical map of critical levels for the USD/JPY pair:
### Resistance:
– 158.00–158.30: Recent highs and near-term barrier
– 160.00: Psychological round number and potential medium-term target
– 161.85–162.00: Long-term Fibonacci extension level from the 2022 rally
### Support:
– 155.00:
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