USD/JPY outlook: Hit new multi-decade high after strong US CPI numbers, intervention looms

Slobodan Drvenica Windsor Brokers

USD/JPY

USDJPY is consolidating near new multi-decade high above 153 mark, after surging around 1% on stronger than expected US inflation data.

Eventual break above narrow two-week range generates initial signal of bullish continuation of the latest bull-leg from 146.48 ((Mar 11 low) and exposes targets at 154.66 (Fibo 123.6% projection and 155.75 (1990 peak).

On the other hand, studies on all larger timeframes are strongly overbought and warn that traders may start to collect profits, while markets remain cautious about possible intervention by Japanese authorities to support weakening yen, though it seems that Japan is not in hurry and looking for the best time to intervene.

Former range tops at 152.00 zone, reinforced by rising 10DMA, now mark significant support which should keep the downside protected and maintain firm bullish bias.

Caution on dip below range floor (151.00 zone) which would risk test of psychological 150 support and next pivot.

Res: 153.50; 154.66; 155.00; 155.75.
Sup: 152.76; 152.00; 151.00; 150.00.

Interested in USD/JPY technicals? Check out the key levels

1. R3 155.27
2. R2 154.26
3. R1 153.71
PP 152.7
1. S1 152.15
2. S2 151.14
3. S3 150.6

Author

Slobodan Drvenica

Windsor Brokers

Industry veteran with over 22 years’ experience, Slobodan Drvenica joined Windsor Brokers in 1995 when he was an active trader for more than 10 years, managing the trading desk and own account departments.

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