This week, the Japanese Yen has shown weakness, breaking the level of 149 Yen per US Dollar. This level was an eleven-month low and attracted the attention of investors, as well as the Japanese government, which may consider intervention in the foreign exchange market. This entire year was characterized by a significant decline in the value of the yen as the Bank of Japan maintained its extremely loose monetary policy even as other major central banks tightened policies.
At the Bank of Japan’s September meeting there were also no hints about a possible end to the policy of negative interest rates, which indicates a rather cautious communication style of the bank. The Japanese yen’s weakness has drawn the attention of Japan’s Finance Ministry, which has stepped up warnings in recent weeks about possible intervention in the foreign exchange market.
It is also important to note that national data shows a slowdown in inflation, which fell to 3.2% in August from 3.3% in July. However, core inflation remained above the Bank of Japan’s 2% target for the seventeenth month in a row.
USD/JPY Weekly Forecast October 2 — 6, 2023
Quotes of the currency pair Dollar/Yen USD/JPY complete the trading week with growth near the area of 149.21. The pair continues to move within the rise and bullish channel. Moving averages indicate a bullish trend. Prices have broken through the area between the signal lines upward, which indicates pressure from buyers of the US dollar and a potential continuation of growth from current levels. At the moment, we should expect an attempt to develop a price decline and a test of the support level near the 143.65 area. Then, a rebound upward and continued growth of the pair to the area above the level of 158.95.
An additional signal in favor of the rise of the Dollar/Yen pair in the current trading week will be a test of the bullish trend line on the relative strength index (RSI). The second signal will be a rebound from the upper border of the downward channel. Cancellation of the growth option for the USD/JPY pair in the current trading week of October 2 — 6, 2023 will be a fall and a breakdown of the 139.05 area. This option will indicate a breakdown of the support area and a continued fall of the pair on Forex to the area below the level of 135.25. Confirmation of growth in the USD/JPY pair will be a breakdown of the resistance area and closing of the price above the level of 151.95.
USD/JPY Weekly Forecast October 2 — 6, 2023 suggests an attempt to test the support level near the 143.65 area. Where can we expect the pair to continue to grow to the area above the level of 158.95. An additional signal in favor of growth will be a test of the trend line on the relative strength index (RSI). Cancellation of the option to raise the pair will be a fall and a breakdown of the level of 139.05. This will indicate a continued decline in the pair with a potential target below the 135.25 area.
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