Dollar/yen had an amazing downfall to end the week. In the upcoming week, Household Spending andIndustrial Production are the main events. Let’ s review the major events awaiting us, with an updated technical analysis for USD/JPY. Last week Masaaki Shirakawa Governor of the BOJ announced that Japan’s economy shows fist signs of recovery after the crash resulted from the earthquake and Tsunami in March. Companies are starting to fix supply chains consumer spending is gaining pace. The yen benefited very well from the low growth in the US as well as the high jobless claims. Will this continue? USD/JPY daily chart with support and resistance lines marked. Click to enlarge: Let’s start: Manufacturing PMI: Tuesday, 0:15. Manufacturing activity narrowed in April to 45.7 from 46.4 in March due to damaged supply chains. This is the lowest reading since April 2009. The decline is likely to continue until supply chains and power supply will be back in order. Household Spending: Tuesday, 0:30. Japanese household spending dropped 8.5% in March on a yearly base after the earthquake and tsunami .The annual decrease is above economist’s expectations of 6.4% fall. A smaller decrease is of 2.6% is expected now. Prelim Industrial Production: Tuesday, 0:50. Japanese industrial production shrank 15.3% in March, the biggest drop since records began in 1953, following a 1.8% increase in February .Industrial production fell 12.9% on a yearly base in March following a 2.9% increase in February. An increase of 2.5% is predicted now. Average Cash Earnings: Tuesday, 2:30. Japanese wage income decreased by 0.4% in March from a year earlier for the first time in 13 months. The job market was also hurt by the major earthquake and Tsunami disaster. Only a few companies from the northeast region participated in the survey. Wage income is expected to decrease by 0.2%. Housing Starts: Tuesday, 6:00. Japan’s housing starts decreased the first time in 10 months by 2.4% YoY following the major earthquake on March 11 destroying the housing market recovery. Economists forecasted a drop of 1.1%. A more significant decrease of 3.2% is forecasted. Capital Spending: Thursday, 0:50. Japanese companies increased spending in the 4th quarter rising by 3.8% from a year earlier following 5.0% increase in the previous quarter. Economists expected a rise of 5.2%. A drop in consumer spending caused this decline. It is probable that the next release will present further drops. Another gain of 3.2% is expected now. OPEC Meetings: Thursday. Dramatic events occurred in the Arab world since the last OPEC meeting in December with extensive uprising in major Arab states in North Africa including Tunisia, Egypt and Libya resulting in removing presidents. It seems like President Mahmoud Ahmadinejad of Iran will participate in the meeting after firing his oil minister and there is no telling about Libya’s participation. * All times are GMT. USD/JPY Technical Analysis Dollar/yen held up well throughout most of the week, bouncing off the 81.33 line (mentioned last week). But after this line was broken, the pair extended its falls and closed significantly lower, at 80.73. Technical levels from top to bottom: 84.50 capped the pair at the end of 2010 and is quite far at the moment. 84 was a lower peak before the March 11 catastrophe and minor resistance now. 83.30 is another weak line after capping the pair just before the disaster at the beginning of March and also working as support a few months earlier. 82.87 was the trough before the BOJ intervention in September 2010 and also played an important role in recent weeks as the peak of a recovery attempt. 82.20 capped the pair in a very stubborn way in the past two weeks and is a very strong line now. 81,33 proved to be a distinctive line separating ranges – it was a double top two weeks ago and now works as resistance. 80.20 cushioned falls at the beginning of May for several days and is the immediate line of support at the moment. 79.75 is the historic low of 1995 and played a critical role when the pair collapsed in March. It’s followed by 79.16 which is minor resistance as well. The last line is 78.27 – both were significant before the big intervention. I am bullish on USD/JPY. The focus moved from the weakness of the Japanese economy to that of the US economy in the past week. But at these levels, Japanese exporters will find it hard to recover after the earthquake, and another intervention can come. *All times are GMT Further reading: For a broad view of all the week’s major events worldwide, read the USD outlook. For EUR/USD, check out the Euro/Dollar forecast. For GBP/USD (cable), look into the British Pound forecast. For the Australian dollar (Aussie), check out the AUD to USD forecast. For the New Zealand dollar (kiwi), read the NZD forecast. For USD/CAD (loonie), check out the Canadian dollar. Anat Dror Anat Dror Anat Dror Senior Writer I conceptualize, design and create multi-lingual websites. Apart from the technical work, my projects usually consist of writing content for these sites in English, French and Hebrew. In the past, I have built, managed and marketed an e-learning center for language studies, including moderating a live community of students. I've also worked as a community organizer Anat's Google Profile View All Post By Anat Dror MajorsUSD JPY Forecast share Read Next EUR/USD Outlook May 30 – June 3 Yohay Elam 12 years Dollar/yen had an amazing downfall to end the week. In the upcoming week, Household Spending andIndustrial Production are the main events. Let' s review the major events awaiting us, with an updated technical analysis for USD/JPY. Last week Masaaki Shirakawa Governor of the BOJ announced that Japan's economy shows fist signs of recovery after the crash resulted from the earthquake and Tsunami in March. Companies are starting to fix supply chains consumer spending is gaining pace. The yen benefited very well from the low growth in the US as well as the high jobless claims. Will this continue? 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