Japanese Yen Short-term Outlook: USD/JPY Recovery at Trend Resistance

Japanese Yen Technical Forecast: USD/JPY Daily / 240min Trade Levels

USD/JPY rebounds off key support into December- Monthly opening-range taking shape
USD/JPY rally now testing confluent downtrend resistance- risk for exhaustion / price inflection ahead
Resistance 151.74/99 (key), 153.02/40, 154.34- Support 148.73-149.60 (key), 146.14/65, 144.17/63

The US Dollar is up more than 2.1% off the monthly low against the Japanese Yen with USD/JPY rebounding off key testing support into the December open. The recovery has now extended into technical resistance at the November downtrend with major US inflation data on tap tomorrow. Battle lines drawn on the USD/JPY short-term technical charts.

Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Yen setup and more. Join live on Monday’s at 8:30am EST.

Japanese Yen Price Chart – USD/JPY Daily

Chart Prepared by Michael Boutros, Sr. Technical Strategist; USD/JPY on TradingView

Technical Outlook: In last month’s Japanese Yen Technical Forecast we noted that USD/JPY was testing the median-line support and that, “the immediate focus is on a breakout of the weekly opening-range for guidance with the near-term threat lower while below 155.” Price broke lower the following week with USD/JPY plunging nearly 5.2% off the November high.

The decline rebounded off confluent support last week at the 2022 weekly high-close / 2023 high-week close (HWC) at 148.73-149.60. The immediate focus is on this recovery with the bulls testing confluent resistance today at 151.74/99- a region defined by the 38.2% retracement of the November decline, the 2022/2023 highs and the 200-day moving average. Looking for a possible reaction off this mark over the next few days.

Japanese Yen Price Chart – USD/JPY 240min

Chart Prepared by Michael Boutros, Sr. Technical Strategist; USD/JPY on TradingView

A closer look at Japanese Yen price action shows USD/JPY trading within the confines of a descending pitchfork extending off the November highs with the upper parallel further highlighting resistance here at 151.74/99. A topside breach would expose the May low-day close (LDC) / 61.8% retracement at 153.02/40 backed by the November high-day reversal close at 154.34- a breach / close above this threshold would be needed to suggest a more significant low was registered last week / a larger trend reversal is underway.

A break below this key support zone would threaten resumption of the November downtrend towards the median-line (currently ~148), with subsequent objectives seen at 146.13/65 and the August low-day close (LDC) / January low-week close (LWC) at 144.17/63- both levels of interest for possible exhaustion / price inflection IF reached.

Bottom line: USD/JPY is rebounding off technical support into the start of the month with the advance now testing the first major resistance hurdle- looking for possible inflection here. From a trading standpoint, the focus is on a breakout of the weekly opening range (149.60-151.99) for guidance with the near-term recovery vulnerable while below the 200-day moving average.

Keep in mind we get the release of key US inflation data tomorrow with the November Consumer Price Index (CPI) on tap. Stay nimble into the release and watch the weekly close here for guidance. Review my latest Japanese Yen Weekly Forecast for a closer look at the longer-term USD/JPY technical trade levels.

USD/JPY Key Economic Data Releases

Economic Calendar - latest economic developments and upcoming event risk.

Active Short-term Technical Charts

--- Written by Michael Boutros, Sr Technical Strategist

Follow Michael on X @MBForex

StoneX Financial Ltd (trading as "FOREX.com") is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, FOREX.com does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date.

This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it. No opinion given in this material constitutes a recommendation by FOREX.com or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.

The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although FOREX.com is not specifically prevented from dealing before providing this material, FOREX.com does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation. For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

FOREX.com is a trading name of StoneX Financial Ltd. StoneX Financial Ltd is a company incorporated in England and Wales with UK Companies House number 05616586 and with its registered office at 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is authorised and regulated by the Financial Conduct Authority in the UK, with FCA Register Number: 446717.

FOREX.com is a trademark of StoneX Financial Ltd. This website uses cookies to provide you with the very best experience and to know you better. By visiting our website with your browser set to allow cookies, you consent to our use of cookies as described in our Privacy Policy. FOREX.com products and services are not intended for Belgium residents.