Japanese Yen technical forecast: USD/JPY weekly trade levels Japanese Yen approaching topside of massive multi-month consolidation USD/JPY ra
Japanese Yen technical forecast: USD/JPY weekly trade levels
- Japanese Yen approaching topside of massive multi-month consolidation
- USD/JPY rally vulnerable into 2023 range highs- risk for price inflection
- Resistance 135.71, 136.66, 139.59– support 134.11, 131.12/30, 129.58
The Japanese Yen is off more than 0.6% against the US Dollar this week with USD/JPY trading just below resistance near the 2023 range highs. The focus is on possible inflection into this zone as price continues to consolidate within a massive multi- month consolidation pattern. These are the updated targets and invalidation levels that matter on the USD/JPY weekly technical chart.
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Japanese Yen Price Chart – USD/JPY Weekly
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, “The recent USD/JPY recovery off support may be vulnerable into these upcoming resistance levels.” We specifically highlighted the 52-week moving average and, “38.2% retracement of the 2022 decline at 136.66– a breach / weekly close above this threshold is needed to mark resumption of the broader uptrend…” Price briefly registered an intraweek high at 137.77 last week but has been unable to mark a weekly close above and the immediate focus is on possible inflection off this zone.
Initial weekly support rests with the yearly high-week close at 134.12 backed by 131.12/31– a region defined by the 61.8% Fibonacci retracement of the yearly range and the objective yearly open. Broader bullish invalidation f the yearly advance remains unchanged at the 2023 low-week close at 129.58.
Initial weekly resistance levels are also unchanged at the 52-week moving average (currently ~136.08) and 136.66. Ultimately, a topside breach / close above this consolidation formation is needed to validate a breakout of the yearly opening-range highs towards the July highs at 139.39 and the key resistance at 142.50– look for a larger reaction there IF reached.
Bottom line: USD/JPY is trading just below resistance near the 2023 range highs with price continuing to contract within the confines of a massive multi-month consolidation pattern. From a trading standpoint, the trade remains constructive while above yearly open with a breach / close above the December trendline needed to fuel a larger breakout in USD/JPY. I’ll publish an updated Japanese Yen short-term outlook once we get further clarity on the near-term USD/JPY technical trade levels.
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— Written by Michael Boutros, Sr Technical Strategist with FOREX.com
Follow Michael on Twitter @MBForex
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