USD/JPY Analysis

• 02 February, 2024 Ruchit Thakur

USD/JPY Analysis

After recovering from the 140.00 level, will the USD/JPY continue to increase or fall ?

The weekly chart shows that the USD/JPY has recovered strongly from 140.00 and is currently trading in the 148.00 region. It might grow significantly higher, possibly reaching 149.00 and 152.00 zones, respectively. Purchasing the USD/JPY at a discount and holding it until it reaches 137.00-138.00 is a prudent investing plan. Any dip in the pair provides an opportunity to buy. As we observed in our previous analysis, the USD/JPY is growing and now makes up 13.5% of the Dollar Index weight. As a result, if the DXY continues to increase, the USD/JPY will likely follow suit.

• As it gathered traction, the USD/JPY increased from 140.50 to 148.00.
• The USD/JPY pair climbed, as shown in the chart below, with a substantial demand spike from the trendline and horizontal support.
• Given that price demand remains on the weekly chart and the DXY is rising after finding support in the 100.50-100.80 range, we may expect further increases in the USD/JPY rate.

The previous chart illustrates that the USD/JPY is in a buy-on-dips pattern, with demand clearly visible between 137.00 and 138.00. The zone in the above chart represents the intersection of the trendline and horizontal support. Upside is available at 149.00-149.50 and 152.50, respectively. 

For the USD/JPY pair, the purchase on dips strategy is in effect. Buying between 137.00 and 138.00 with a tight stop loss is crucial. The stop loss should be set approximately below the 137.00 zone, with objectives of around 149.50 and 152, respectively. Every decline in USD/JPY is a buying opportunity, and look for more dips around the 140 level to buy this pair for more upside potential.

Please study the weekly USD/JPY chart's support and resistance levels. Each level is shown on a spot chart.