FxNews—On Tuesday, the Japanese Yen traded at about 153.4 yen for one U.S. dollar after dropping sharply on Monday. The Yen is mainly weaker because the U.S. dollar is getting stronger. Investors and traders expect strong economic growth in the United States and believe President Trump’s trade policies will lead to higher inflation. This expectation makes the U.S. dollar more valuable compared to the Yen.
Rate Hike Debate Heats Up at Bank of Japan
The central bank—the Bank of Japan—summarized its October policy meeting in Japan. This summary showed that bank leaders are divided on when to raise interest rates.
Some are concerned about uncertainties in the global economy and increased market instability, especially as the Yen continues to lose value. Despite these worries, the Bank of Japan still plans to raise its main interest rate to 1% by the second half of fiscal year 2025.
Officials Alert as Japanese Yen Weakens
Because the Yen has been weakening, Japanese officials have issued warnings. Finance Minister Katsunobu Kato said that Japan is prepared to take “appropriate action” to deal with extreme changes in the foreign exchange market.
USDJPY Technical Analysis – 12-November-2024
The USD/JPY currency pair trades in an uptrend, within the bullish flag and above the 50- and 100-period simple moving averages. As for the technical indicators, the Stochastic Oscillator signals overbought while the Awesome Oscillator histogram declines.
This development in the technical tools suggests the U.S. dollar could be overpriced in the short term against the Japanese Yen.
USDJPY Forecast – 12-November-2024
The USD/JPY trend outlook remains bullish as long as the price is above the 151.5 (October 25 low) resistance. From a technical perspective, the uptrend will likely resume if bulls stabilize USD/JPY above the 153.9 mark, which is active support. If this scenario unfolds, the next bullish target could be the 157.1 (%78.6 Fibonacci) mark.
Please note that the bullish outlook should be invalidated if USD/JPY dips below the 151.5 support.
- Support: 153.0 / 151.5
- Resistance: 153.9 / 157.1
J.J Edwards is a finance expert with 15+ years in forex, hedge funds, trading systems, and market analysis.
