US Dollar Forecast: USD/JPY Holds Above Former Resistance

Forex trading
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By :  ,  Strategist

US Dollar Outlook: USD/JPY

USD/JPY may mirror the price action from May as it holds above the former-resistance zone around the 2022 high (151.95), but the exchange rate may face range bound conditions amid the flattening slope in the 50-Day SMA (157.84).

US Dollar Forecast: USD/JPY Holds Above Former Resistance

Keep in mind, USD/JPY rallied to a fresh yearly high (161.95) after testing the former-resistance zone back in May, and the region may continue to act as support as the rebound from the monthly low (151.95) keeps the Relative Strength Index (RSI) out of oversold territory.

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USD/JPY Price Chart – Daily

USDJPY Daily Chart 07302024

Chart Prepared by David Song, Strategist; USD/JPY on TradingView

  • USD/JPY may extend the rebound from the monthly low (151.95) as it holds above the former-resistance zone around the 2022 high (151.95) but need a close above the 156.50 (78.6% Fibonacci extension) to 157.00 (23.6% Fibonacci retracement) region to bring 159.30 (38.2% Fibonacci extension) on the radar.
  • Next area of interest comes in around the 1990 high (160.40) but USD/JPY may trade within the monthly range as the 50-Day SMA (157.84) no longer reflects a positive slope.
  • At the same time, failure to hold above the 151.40 (50% Fibonacci retracement) to 151.95 (2022 high) area may push USD/JPY towards the April low (150.81), with the next hurdle coming in around 150.30 (61.8% Fibonacci extension).

Additional Market Outlooks

Federal Reserve Preview (JUL 2024)

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--- Written by David Song, Strategist

Follow on Twitter at @DavidJSong

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