Japanese Yen Technical Forecast: USD/JPY Bulls Eye Resistance

Japanese Yen Technical Forecast: USD/JPY Weekly / Daily Trade Levels

USD/JPY September reversal extends nearly 6.9% off yearly low- rally testing major pivot zone
USD/JPY bulls may be vulnerable near-term, outlook constructive above October open
Resistance 148.73-149.60 (key), ~151, 151.94- Support 146.42/65, 143.63/90 (key), 140.25-141.02

The Japanese Yen is off more than 0.3% this week with USD/JPY rallying nearly 3.9% since the start of October. Last month’s reversal off technical support has now extended into a major pivot zone and the focus is on possible price inflection here in the days ahead. Battle lines drawn on the USD/JPY weekly & daily 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 (also streaming live on YouTube).

Japanese Yen Price Chart – USD/JPY Weekly

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

Technical Outlook: In my last Japanese Yen Technical Forecast we noted that USD/JPY had rebounded off major support and that, “losses should be limited to the 142-handle IF price is heading higher on this stretch with a close above 144.63 needed to fuel to fuel the next leg.” Price briefly registered an intraweek low at 141.65 last week but failed to mark a close below 142 with the subsequent rally marking the largest single-week advance in nearly 15 years.

The advance has now extended more than 6.8% off the September low with the rally testing a major resistance pivot this week at 148.73-149.60- a region defined by the 2022 high-close and the 2023 high-week close (HWC). Note that the 52-week moving average rests just higher- the focus is on possible inflection / price exhaustion into this region this week.

Japanese Yen Price Chart – USD/JPY Daily

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

A closer look at the daily chart shows USD/JPY continuing to trade within the confines of the descending pitchfork we’ve been tracking off the July high. A rebound off the lower parallel has now broken through the median-line with the 75% parallel further highlighting near-term resistance at 148.73-149.60.

A topside breach / close above this threshold is needed to keep the immediate advance viable towards the 200-day moving average (currently ~151) and the 2022 high at 151.94. Key resistance is eyed at 152.85-153.40- a region defined by the 1.618% extension of the September advance and the 61.8% retracement of the yearly range. A breach / close above this confluence zone would be needed to invalidate the July downtrend / suggest a larger trend reversal is underway.

Initial support rests with the February low-day close (LDC) / August low-week close (LWC) at 146.42/65 with near-term bullish invalidation now raised to the objective monthly open / 2024 LWC at 143.63/90. Critical support remains unchanged at 140.25-141.02- a close below this threshold would ultimately be needed to mark downtrend resumption.

Bottom line: A reversal off key support at the yearly lows in USD/JPY is now testing a major pivot zone into downtrend resistance. From at trading standpoint, a good zone to reduce portions of long-exposure / raise protective stops – losses should be limited to the October open IF price is heading higher on this stretch with a close above the 75% parallel needed to fuel the next major leg. Keep in mind we get the release of the September Consumer Price Index (CPI) tomorrow - stay nimble into the release and watch the weekly closes here for guidance.

USD/JPY Key Economic Data Releases

Economic Calendar - latest economic developments and upcoming event risk.

Active Weekly Technical Charts

--- Written by Michael Boutros, Sr Technical Strategist

Follow Michael on X @MBForex

The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase or sale of any currency or CFD contract. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. Any references to historical price movements or levels is informational based on our analysis and we do not represent or warranty that any such movements or levels are likely to reoccur in the future. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

Futures, Options on Futures, Foreign Exchange and other leveraged products involves significant risk of loss and is not suitable for all investors. Losses can exceed your deposits. Increasing leverage increases risk. Spot Gold and Silver contracts are not subject to regulation under the U.S. Commodity Exchange Act. Contracts for Difference (CFDs) are not available for US residents. Before deciding to trade forex, commodity futures, or digital assets, you should carefully consider your financial objectives, level of experience and risk appetite. Any opinions, news, research, analyses, prices or other information contained herein is intended as general information about the subject matter covered and is provided with the understanding that we do not provide any investment, legal, or tax advice. You should consult with appropriate counsel or other advisors on all investment, legal, or tax matters. References to FOREX.com or GAIN Capital refer to StoneX Group Inc. and its subsidiaries. Please read Characteristics and Risks of Standardized Options.

FOREX.com is a registered FCM and RFED with the CFTC and member of the National Futures Association (NFA # 0339826). Forex trading involves significant risk of loss and is not suitable for all investors. Full Disclosures and Risk Warning. Increased leverage increases risk.

GAIN Capital Group LLC (dba FOREX.com) 30 Independence Blvd, Suite 300 (3rd floor), Warren, NJ 07059, USA. GAIN Capital Group LLC is a wholly-owned subsidiary of StoneX Group Inc.