USD/JPY Price Forecast: Dollar finds support at previous resistance area around 161.00
- USD/JPY drops abruptly to session lows around 161.00 from fresh 40-year highs near 163.00.
- The lack of fundamental drivers to explain the move has raised speculation of some Tokyo action.
- US Dollar's next support levels are 161.00 and 160.50.
The Japanese Yen (JPY) staged a sharp rebound against the US Dollar (USD) on Friday, raising speculation about potential action by the Japanese Ministry of Finance (MoF). The USD/JPY chart accelerated its reversal from 40-year highs near 163.00, finding support at a previous resistance level of 161.00.
Yen’s recovery is lacking a clear driver, which has put JPY sellers on their toes, wary of a new round of interventions, as Friday’s July 4 holiday in the US provides an ideal opportunity for Tokyo authorities to optimise the impact of their actions.
Asked about the Yen's sudden recovery, the Japanese Finance Minister Satsuki Katayama declined to make any comment, as reported by Reuters. Earlier on the day, Toshihiro Nagahama, a private-sector member on Japanese Prime Minister Takaichi's Council on Economic and Fiscal Policy, affirmed that he expects the Bank of Japan (BoJ) to hike interest rates again before the end of the year. These comments, however, are unlikely to have boosted the JPY's comeback, as they just confirm a scenario already priced in by the market.
Technical Analysis: Next supports are at 161.00 and 160.50
USD/JPY trades at 161.24, after trimming the previous day's losses with momentum indicators picking up from oversold levels. Intraday charts, however, highlight a strong immediate bearish bias, with the four-hour Relative Strength Index (14) just above 30, hinting at stretched conditions, with the Moving Average Convergence Divergence (MACD) has turned negative, reinforcing waning upside momentum.
On the downside, the area between the June 19 low, around 161.00, and the 61.8% Fibonacci retracement of the June 11-30 upleg, at 160.78, has contained the decline so far. Further down, the June 18 low near 160.50 emerges as the next downside target. The 160.00 psychological level seems too far away for today.
On the topside, bulls might find resistance at the 38.2% Fibonacci retracement of the mentioned cycle, which is coincident with the June 25 and 26 lows at the 161.60 area, ahead of Wednesday's lows at 162.30.
(The technical analysis of this story was written with the help of an AI tool.)
(This story was corrected on July 02 at 10:11 GMT to say that the USD/JPY's next support is at 161.00 and note at 1612.00 as previously written.)
Japanese Yen Price Today
The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the US Dollar.
| USD | EUR | GBP | JPY | CAD | AUD | NZD | CHF | |
|---|---|---|---|---|---|---|---|---|
| USD | -0.32% | -0.49% | -0.89% | -0.14% | -0.17% | -0.29% | -0.57% | |
| EUR | 0.32% | -0.17% | -0.55% | 0.17% | 0.15% | 0.07% | -0.25% | |
| GBP | 0.49% | 0.17% | -0.37% | 0.32% | 0.32% | 0.25% | -0.08% | |
| JPY | 0.89% | 0.55% | 0.37% | 0.72% | 0.71% | 0.57% | 0.30% | |
| CAD | 0.14% | -0.17% | -0.32% | -0.72% | -0.02% | -0.12% | -0.42% | |
| AUD | 0.17% | -0.15% | -0.32% | -0.71% | 0.02% | -0.09% | -0.39% | |
| NZD | 0.29% | -0.07% | -0.25% | -0.57% | 0.12% | 0.09% | -0.30% | |
| CHF | 0.57% | 0.25% | 0.08% | -0.30% | 0.42% | 0.39% | 0.30% |
The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).
Author
Guillermo Alcala
FXStreet
Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.
