The USD/JPY pair saw a slight increase to 153.87 last week, but it wasn’t able to hold above the 61.8% retracement level of 161.94 to 139.57 at 153.39, leading to a retreat. This week, the initial bias is neutral for more consolidations. However, there is an expectation for a further rally as long as the 55-day EMA (currently at 148.96) remains intact. If the pair can sustain trading above 153.39, it may retest the high of 161.94.
Looking at the bigger picture, the price movements from 161.94 appear to be part of a corrective pattern within the larger upward movement from 102.58 (2021 low). The medium-term consolidation range is likely between the 38.2% retracement level of 102.58 to 161.94 at 139.26 and 161.94. Nevertheless, a sustained break of 139.26 could indicate a deeper decline towards the 61.8% retracement level at 125.25.
In the long-term perspective, it is too early to determine if the uptrend from 75.56 (2011 low) has finished. However, there are signs of a medium-term corrective phase beginning, with a possibility of a significant correction towards the 55-month EMA (currently at 134.54).
It is essential for traders and investors to monitor these key levels and indicators to make informed decisions in the volatile foreign exchange market. By staying updated on the latest forecasts and analysis, market participants can better navigate the fluctuations in the USD/JPY pair and potentially capitalize on trading opportunities.
