USD/JPY outlook: Trades near a multi-decade high, intervention looms

Slobodan Drvenica Windsor Brokers

USD/JPY

USD/JPY is consolidating above 161 level on Friday after Thursday’s fresh acceleration higher hit 161.80, just ticks under a four-decade peak at 161.95, posted in June 2024.

The pair remains well supported and continued to trend higher after breaking the first threshold at 160, as dollar received fresh support from hawkish stance of the US central bank, which signaled a rate hike by the end of the year in the policy meeting earlier this week.

Friday’s action was so far shaped in a tight Doji candle, reflecting firm bullish structure, but overbought conditions, as well as tension in the market on looming intervention.

Japanese Financial Minister reiterated that authorities are prepared to take decisive action to arrest a slide in national currency.

However, another scenario in which Japanese authorities may keep their action on hold, remains on the table, with yen expected to surge well above 162 breakpoint zone in such case.

Res: 161.80; 161.95; 162.89; 163.57.
Sup: 160.72; 160.51; 160.00; 159.11.

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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