US Dollar Forecast: USD/JPY Rebounds Ahead of December Low
US Dollar Outlook: USD/JPY
USD/JPY may mirror the price action from the end of 2023 as it rebounds ahead of the December low (140.25).
US Dollar Forecast: USD/JPY Rebounds Ahead of December Low
USD/JPY may attempt to retrace the decline from the monthly high (147.21) as the Relative Strength Index (RSI) continues to hold above 30, but the shift in carry-trade interest seems to be influencing the exchange rate as it failed to defend the January low (140.82).
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With that said, USD/JPY may stage further attempts to test the December low (140.25) as the Federal Reserve is expected to deliver a rate-cut at its interest rate decision on September 18, and the fresh forecasts from Chairman Jerome Powell and Co. may influence foreign exchange markets as the central bank is slated to update the Summary of Economic Projections (SEP).
USD/JPY Price Chart – Daily
Chart Prepared by David Song, Strategist; USD/JPY on TradingView
- USD/JPY may mirror the price action from the end of 2023 if it fail to break/close below the 140.50 (61.8% Fibonacci retracement) to 141.50 (38.2% Fibonacci extension) region, with a move above the 144.60 (50% Fibonacci retracement) to 145.90 (50% Fibonacci extension) area bringing the monthly high (147.21) on the radar.
- Next region of interest comes in around 148.70 (38.2% Fibonacci extension) but USD/JPY may stage further attempts to test the December low (140.25) should it track the negative slope in the 50-Day SMA (149.74).
- A further decline in USD/JPY may push the RSI into oversold territory for the second time this year, with a close below the 140.50 (61.8% Fibonacci retracement) to 141.50 (38.2% Fibonacci extension) region opening up the July 2023 low (137.24).
Additional Market Outlooks
US Dollar Forecast: USD/CAD Pushes Above September Opening Range
EUR/USD Fails to Hold in September Opening Range Ahead of ECB
US Dollar Forecast: GBP/USD Susceptible to Bull-Flag Formation
Australia Dollar Forecast: AUD/USD Reverses Ahead of January High
--- Written by David Song, Strategist
Follow on Twitter at @DavidJSong
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