News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.



Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events


Economic Calendar

Economic Calendar Events

Free Trading Guides
Please try again
More View more
Breaking news

UK to Announce Vaccine Passports and WFH Guidance in Move to Plan B

Japanese Yen Technical Outlook: USD/JPY Breakout Tests for Higher Low

Japanese Yen Technical Outlook: USD/JPY Breakout Tests for Higher Low

Michael Boutros, Strategist

Japanese Yen Technical Price Outlook: Near-term Trade Levels

  • Japanese Yen technical trade levels update – Daily & 120min Charts
  • USD/JPY breakout testing initial support – weekly opening-range intact
  • Constructive while above 106.42 - resistance steady at 107.69

The Japanese Yen is more than 0.5% lower against the US Dollar this week with USD/JPY carving a clean weekly opening-range just above near-term uptrend support. This is the first test for the recent dollar breakout and it’s make-or-break here for the reversal play. These are the updated targets and invalidation levels that matter on the USD/JPY technical price charts. Review my latest Weekly Strategy Webinar for an in-depth breakdown of this Yen trade setup and more.

Japanese Yen Price Chart – USD/JPY Daily

Japanese Yen Price Chart - USD/JPY Daily - Dollar vs Yen Trade Outlook - Technical Forecast

Chart Prepared by Michael Boutros, Technical Strategist; USD/JPY on Tradingview

Notes: In my last Japanese Yen Price Outlook we noted that USD/JPY was testing support at the 2019 low-day close, “with a close below 106.10 needed to fuel the next leg lower in the Dollar.” Price held that low into the close of last week with a breakout on Monday fueling recovery up to the 50% retracement of the April decline at 107.69. The monthly opening-range is set just above the 106-handle and we’re looking for the break for guidance.

Japanese Yen Price Chart – USD/JPY 120min

Japanese Yen Price Chart - USD/JPY 120min - Dollar vs Yen Trade Outlook - Technical Forecast

Notes: A closer look a Yen price action shows USD/JPY trading within the confines of a near-term ascending pitchfork formation with price reversing off the 75% parallel early in the week. The decline is now trading just above confluence support at the lower parallel / 61.8% retracement at 106.67 with the 61.8% extension / weekly open just lower at 106.42/49- look for downside exhaustion ahead of this threshold IF price is indeed heading higher. Monthly open resistance steady at 107.13 backed closely by 107.37. A breach above the median-line / 107.69 would be needed to mark resumption towards 108.09.

For a complete breakdown of Michael’s trading strategy, review his Foundations of Technical Analysis series on Building a Trading Strategy

Bottom line: USD/JPY is approaching near-term uptrend support and a hold above 106.42 is needed to keep the breakout viable in the days ahead. From a trading standpoint, look for downside exhaustion ahead of the lower parallel with a breach above 107.69 needed to fuel the next leg higher in price. Ultimately a break / close below 106.10 would be needed to put the bears back in control with such a scenario exposing the 61.8% retracement at 105.20. Review my latest Japanese Yen Weekly Price Outlook for a closer look at the longer-term USD/JPY technical trade levels.

Japanese Yen Trader Sentiment – USD/JPY Price Chart

Japanese Yen Trader Sentiment - USD/JPY Price Chart - Trade Outlook - Technical Forecast
  • A summary of IG Client Sentiment shows traders are net-long USD/JPY - the ratio stands at +1.15 (53.58% of traders are long) – neutral reading
  • Long positions are 8.82% higher than yesterday and 1.99% lower from last week
  • Short positions are 2.40% lower than yesterday and 9.90% higher from last week
  • We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests USD/JPY prices may continue to fall. Traders are more net-long than yesterday but less net-long from last week. The combination of current positioning and recent changes gives us a further mixed USD/JPY trading bias from a sentiment standpoint.


Key US / Japan Data Releases

Key US / Japan Data Releases - USD/JPY Economic Calendar - Event Risk

Economic Calendar - latest economic developments and upcoming event risk.

Active Trade Setups

--- Written by Michael Boutros, Technical Currency Strategist with DailyFX

Follow Michael on Twitter @MBForex

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.