- The USD/JPY pair could extend its upwards movement after escaping from the major range pattern.
- The descending pitchfork’s upper median line (UML) stands as an upside target.
- Escaping from the Falling Wedge pattern signaled an upside momentum.
Our USD/JPY forecast sees the pair rally today and it seems strong enough to approach and reach fresh new highs. The pair rallied only because the Japanese Yen Futures plunged in the short term weakening the Yen.
If the Yen Futures sell-off continues, the currency pair could approach and reach fresh new highs, even if the DXY is bearish at the time of writing.
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The price escaped from a range pattern and from a Falling Wedge formation today, so the upside pressure is high. Fundamentally, the US Dollar received a helping hand from the US JOLTS Job Openings indicator which was reported at 11.03M far above 10.45M forecasts and above 10.60M in the previous reporting period.
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On the contrary, the Yen was punished by poor Japanese economic data in the early morning, so JPY’s sell-off is understandable. The Final GDP dropped by 0.9% more compared to the 0.8% expected while the Final GDP Price Index registered a 1.2% drop versus 1.1% expected.
Furthermore, the Economy Watchers Sentiment was reported at 56.3 below 57.3 expected, while the Bank Lending rose by 0.6% less than the 0.7% estimates.
USD/JPY Forecast: Price Technical Analysis – Falling Wedge
As you can see on the H4 chart, the USD/JPY pair registered only false breakdowns with great separation below the 113.40 static support and below the median line (ML) signaling that the bulls are still in the game. In the short term, it has escaped from a minor Falling Wedge pattern signaling an upside momentum.
The aggressive breakout through the 113.70 signaled that we may have an upside continuation. Now, it has reached the 113.95 static resistance, so we cannot exclude a temporary decline after its amazing rally. Jumping and closing above this obstacle could validate an upside continuation.
From the technical point of view, escaping from the range between 112.53 and 113.70 signaled an upside reversal. The descending pitchfork’s upper median line (UML) stands as a dynamic resistance, as an upside target.
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