The USD/JPY pair saw a rise from 139.57 to 149.58 last week before moving sideways. The forecast for this week suggests a neutral bias initially, with the possibility of further consolidation. However, a continued rally is anticipated as long as the support at 145.91 holds. If the pair surpasses the 149.58 mark, it is likely to continue its upward trajectory towards the 61.8% retracement level of 161.94 to 139.57, which stands at 153.39.
Taking a broader view, the price movements from 161.94 are interpreted as a corrective pattern within the larger uptrend from the 2021 low of 102.58. The medium-term consolidation range is expected to be between the 38.2% retracement level of 102.58 to 161.94 at 139.26 and the high of 161.94. However, a sustained break below 139.26 could lead to a deeper decline towards the 61.8% retracement level at 125.25.
Looking at the long-term perspective, it is too early to determine whether the uptrend from the 2011 low of 75.56 has concluded. Nonetheless, there are indications of a medium-term corrective phase beginning, with a potential for a significant correction towards the 55 M EMA, currently positioned at 133.73.
In summary, the USD/JPY pair is expected to experience further consolidation in the short term, with a possibility of a continued rally if key support levels are maintained. The broader outlook suggests a corrective phase within a larger uptrend, but caution is advised in case of a deeper decline in the medium term. Traders and investors are advised to closely monitor key support and resistance levels to make informed decisions in the volatile foreign exchange market.
