USDJPY Outlook

USD/JPY's steep decline last week confirms medium term topping at 163.97, on bearish divergence condition in D MACD. Fall from there is seen as correcting the whole rise from 139.87. Initial bias remains on the downside this week for 155.01 cluster support (38.2% retracement of 139.87 to 163.97 at 154.76). Strong support should be seen there to bring rebound, at least on first attempt. Nevertheless, risk will now remain on the downside as long as 160.87 minor resistance holds, in case of recovery.

In the bigger picture, as long as 155.01 structural support holds, the larger up trend is still expected to continue through 163.97 after current correction completes. However, firm break of 155.01 will raise the chance that USD/JPY is already in a larger scale correction, and open up deeper fall back to 139.87 (2025 low) in the medium term.

In the long term picture, up trend from 75.56 (2011 low) is still in progress. Next target is 61.8% projection of 102.58 (2020 low) to 161.94 (2024 high) from 139.87 at 176.55 in the medium term. Long term outlook will stay bullish as long as 139.87 support holds, even in case of deep pullback.

Focus stays on rising channel floor (now at 158.14) in USD/JPY. Sustained break there will argue that fall from 163.97 is already correcting the whole rise from 139.87, and target 155.01 cluster support (38.2% retracement of 139.87 to 163.97 at 154.76). Strong rebound from the channel support will keep the rally from 139.87 intact. But still, even in this case, more consolidations would be seen below 163.97 for a while.

In the bigger picture, the break of 159.44 resistance turned support, together with bearish divergence condition in D MACD, suggests that a medium term top could be formed at 163.97 already. More consolidations would be seen in the near term. But still, outlook will remain bullish as long as 152.25 support holds. The long term up trend is still expected to continue at a later stage, only delayed.

USD/JPY's steep decline today suggests that a medium term top is probably formed at 163.97 already. Immediate focus is now on rising channel floor (now at 158.74). Sustained break there will argue that fall from 163.97 is already correcting the whole rise from 139.87, and target 155.01 cluster support (38.2% retracement of 139.87 to 163.97 at 154.76. Strong rebound from the channel support will keep the rally from 139.87 intact. But still, even in this case, more consolidations would be seen below 163.97 for a while.

In the bigger picture, the break of 159.44 resistance turned support, together with bearish divergence condition in D MACD, suggests that a medium term top could be formed at 163.97 already. More consolidations would be seen in the near term. But still, outlook will remain bullish as long as 152.25 support holds. The long term up trend is still expected to continue at a later stage, only delayed.