Current trend

In late May, the yen grew significantly against USD due to the Bank of Japan's decisions on inflation and monetary policy, which increased the investment attractiveness of the Japanese currency. Later, the pair reached the strong support level at 108.15, and then the yen weakened. USD continued to rise, and the pair restored to the levels of 110.00 and 110.20.

This week, due to the lack of key catalysts, the US currency is decreasing against all major currencies, including JPY. However, the pair stays within the long-term upward channel. Today, the pair will stay within the current trend or will consolidate flat.

Support and resistance

In the medium term, the upward trend maintains, the pair will grow to local highs and test new peaks. Most likely, the instrument will not be able to overcome the strongest support levels of 109.25, 109.00, where the upward momentum is expected to restore. The main catalyst may be tightening monetary policy and Fed’s rates increase in the coming months.

On the daily and higher charts, technical indicators support the forecast: MACD volumes of long positions stay high, Bollinger bands are directed upwards.

Resistance levels: 109.55, 109.85, 110.00, 110.50, 111.00.

Support levels: 109.25, 109.00, 108.45, 108.15, 107.70, 107.30, 107.00, 106.50.

Trading tips

It is relevant to increase the volumes of long positions from the current level with the target at 111.00, in the medium term – 111.50, 112.70 and stop loss 108.00.

US Dollar vs Japanese Yen

BuySellSpread
112.743112.70637

Scenario

TimeframeWeekly
RecommendationsBUY
Entry Point109.25
Take Profit111.00, 111.50, 112.70
Stop Loss108.00
Support levels106.50, 107.00, 107.30, 107.70, 108.15, 108.45, 109.00, 109.25, 109.55, 109.85, 110.00, 110.50, 111.00
USD/JPY: the dollar will grow

The material published on this page is produced by the Claws&Horns Company and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC; furthermore it has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

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