USD/JPY Forecast: Further advances not clear yet

Valeria Bednarik FXStreet

USD/JPY Current Price: 109.14

A better market mood helped the pair recover the 109.00 mark.
BOJ Summary of Opinions and Japan’s Consumer Confidence coming up next.
USD/JPY would turn short-term bullish on a bullish extension above 109.30.

The USD/JPY pair recovered some ground in the last trading session of the day, reaching a fresh weekly high of 109.19 and settling not far below this last. The dollar retained its dominant strength, while the Japanese currency eased on the back of an improved market mood. After Asian and European equities struggled around their opening levels, finishing the day mixed, Wall Street posted substantial gains, with the Dow up over 200 points. Government bond yields stated the day falling to fresh multi-week lows, although later recovered to close in the green. The yield on the benchmark 10-year Treasury note recovered from 1.57% to settle at around 1.64%.

Japan published this Tuesday the December Corporate Service Price Index, which came in at 2.1% YoY, matching the market’s forecast. During the upcoming Asian session, the BOJ will release the Summary of Opinions, while later in the day, the country will publish the January Consumer Confidence Index, foreseen at 40.8 from the previous 39.1.

USD/JPY short-term technical outlook

The USD/JPY pair s trading around 109.10, with further gains unclear at this point, as the 4-hour chart shows that sellers surged on a test of a bearish 20 SMA, which continues heading south below the larger ones. Technical indicators, in the meantime, have recovered from their daily lows, but lost strength upward well below their midlines. The pair would need to extend its recovery beyond 109.30, a Fibonacci resistance and where it left on Friday, to be able to continue advancing toward the 110.00 figure.

Support levels: 108.90 108.65 108.20

Resistance levels: 109.30 109.75 110.05

View Live Chart for the USD/JPY

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

EUR/USD hovers around nine-day EMA above 1.1800

EUR/USD remains in the positive territory after registering modest gains in the previous session, trading around 1.1820 during the Asian hours on Monday. The 14-day Relative Strength Index momentum indicator at 54 is edging higher, signaling improving momentum. RSI near mid-50s keeps momentum balanced. A sustained push above 60 would firm bullish control.

GBP/USD holds medium-term bullish bias above 1.3600

The GBP/USD pair trades on a softer note around 1.3605 during the early European session on Monday. Growing expectation of the Bank of England’s interest-rate cut weighs on the Pound Sterling against the Greenback.

Gold sticks to gains above $5,000 as China's buying and Fed rate-cut bets drive demand

Gold surges past the $5,000 psychological mark during the Asian session on Monday in reaction to the weekend data, showing that the People's Bank of China extended its buying spree for a 15th month in January. Moreover, dovish US Federal Reserve expectations and concerns about the central bank's independence drag the US Dollar lower for the second straight day, providing an additional boost to the non-yielding yellow metal.

Bitcoin, Ethereum and Ripple consolidate after massive sell-off

Weekly column: Saturn-Neptune and the end of the Dollar’s 15-year bull cycle

Tariffs are not only inflationary for a nation but also risk undermining the trust and credibility that go hand in hand with the responsibility of being the leading nation in the free world and controlling the world’s reserve currency.

Bitcoin, Ethereum and Ripple consolidate after massive sell-off

Bitcoin, Ethereum, and Ripple prices consolidated on Monday after correcting by nearly 9%, 8%, and 10% in the previous week, respectively. BTC is hovering around $70,000, while ETH and XRP are facing rejection at key levels. Traders should be cautious: despite recent stabilization, upside recovery for these top three cryptocurrencies is capped as the broader trend remains bearish.