USD/JPY Analysis

• 17 January, 2024 Ruchit Thakur

USD/JPY Analysis

Evening Update: After recovering from the 140.00 area, will the USD/JPY continue to rise or decline ?

The weekly chart shows that the USD/JPY has recovered well from the 140.00 area and is now trading in the 148.00 zone. It could grow even higher, possibly reaching the 149.00 and 152.00 zones, respectively. Purchasing the USD/JPY at a discount and holding onto it until it hits the 137.00–138.00 range is a wise investing strategy. Any drop in the pair is an opportunity to buy. The USD/JPY is increasing and weighted 13.5% in the Dollar Index, as we observed in our previous study. Therefore, there's a better chance that USD/JPY will rise in lockstep with the Dollar Index if the DXY keeps rising.
 

• As it gathered speed, the USD/JPY increased from the 140.50 to 148.00 level.
• The USD/JPY pair surged, as shown in the chart below, which also shows a strong demand spike from the trendline and horizontal support.
• Given that price demand is still there on the weekly chart and the DXY is rising after establishing support in the 100.50–100.80 range, we might expect a further increase in the USD/JPY price.

Look at the previous chart to see that the USD/JPY is in a buy on dips pattern and that the 137.00–138.00 zone is clearly seeing demand. This zone in the chart above represents the intersection of trendline support with horizontal support. Upside is available for 149.00-149.50, and 152.50, in that order. 

For the USD/JPY pair, the buy on dips strategy is in effect. Buying between 137.00 and 138.00 with a strict stop loss is essential. With targets at approximately 149.50 and 152, respectively, and slightly below the 137.00 zone, the stop loss should be placed.

Please look at the USD/JPY weekly chart's support and resistance levels. A spot chart is used to display each level.