USD/JPY completely reversed the previous moves and fell sharply, breaking uptrend support. Retail Sales, Tokyo Core CPI and Prelim Industrial Production are the main events this week. Here’s an outlook for the Japanese events and an updated technical analysis for USD/JPY. Japan saw yet another month of deficit in its trade balance, yet the yen ignored it. What helped the Japanese currency was the release of dovish meeting minutes from the Fed’s last meeting. Speculation about dollar printing weakened the dollar, and the yen didn’t stop despite the doubts. Updates: In its monthly economic report, the Japanese government downgraded its view of economic growth, citing weaker exports and lower consumer spending. The yen has edged lower, as USD/JPY was trading at 0.7865. Retail Sales will be released later on Wednesday. . Retail Sales contracted for the first time in 2012, dropping by 0.8%. The market estimate stood at -0.1%. The yen continues to trade in a narrow range, as USD/JPY was trading at 78.61. USD/JPY daily chart with support and resistance lines on it. Click to enlarge: Retail Sales: Wednesday, 23:50. Japanese retail sales deteriorated in June, rising a mere 0.2% from a year earlier, after a strong 3.6% climb in May. The reading missed forecasts for a 1.2% climb. Manufacturing PMI: Thursday, 23:15. Japanese manufacturing activity contracted in July reaching 47.9 from49.9 in June, amid a slowdown in Europe and China lowering demand for Japanese goods overseas. The index was below the 50 point line for the second consecutive month. The weakening global demand weighs on Japanese economy. Household Spending: Thursday, 23:30. Japan’s household spending continued to increase in June marking the fifth straight year-on-year rise with a 1.6% gain, amid lasting effects of government subsidies for buying low-emission vehicles. However the increase was below the 3.0% climb predicted by analysts but domestic demand seems to be recovering at a moderate pace. Moreover, the average real income of salaried workers’ households increased 3.8% to Y712,592 in June, the sixth straight climb boosting domestic activity . Tokyo Core CPI: Thursday, 23:30.Japan’s core-core inflation index, which excludes food and energy prices declined 0.6% in June from a year ago indicating only a slight improvement in domestic demand since the earthquake hit Japan a year ago. BOJ Governor Masaaki Shirakawa believes consumer prices could rise by 1% in 2014 with a gradual economic improvement. Industrial Production: Thursday, 23:50. Japanese preliminary industrial production reading showed a 0.1% decline in June, eventually revised up to a 0.4% climb. This was the first rise in three months following a 3.4% decline in May. On a yearly basis, industrial production declined 2.0% above the 0.1 contraction anticipated, following the 6.0% climb in the previous month. Housing Starts: Friday, 5:00. Housing starts in Japan dropped unexpectedly 0.2% in June from a year earlier, falling for the first time in five months following a boost of 9.3% in May indicating the pace of recovery in the construction industry is slowing down. Annualized housing starts totaled 837,000, compared to903,000 in May. However despite the low reading, construction orders received by big 50 contractors jumped 4.6 % annually in June, recovering from a 0.9 percent decline in the previous month. * All times are GMT. USD/JPY Technical Analysis Dollar/yen drifted through uptrend resistance (mentioned last week) before making a really big fall. It was later capped under 78.80. Technical lines from top to bottom 83.20 was support during that period and also beforehand. It is weak resistance now. 82.87 is a veteran line – that’s where the BOJ intervened for the first time back in 2010. 81.80 capped the pair in April. 81.43 is stronger after serving as resistance for a recovery attempt. 80.60 provided support for the pair around the same time, and served as a bouncing spot for the next moves. It proved its strength as resistance in June 2012, more than once. 80.20 separated ranges in May 2012 and remains another barrier after 80 on the upside. The round number of 80 is psychologically important, even though it was crossed several times in recent months. It is stronger now. 79.70 was a cap was seen in June 2012. It proved its strength as resistance once again in July 2012 and proved critical before the downfall in August 2012. 79.10 was a cushion for the pair several times in June and also back in May 2012. It proved to be a very distinct separator during August. Close by, 78.80 proved its strength as resistance in August 2012 and is becoming stronger once again. The round number of 78 is now stronger support after being the bottom of the range. 77.50 was the bottom border of a range the pair had at the end of 2011. It is followed by 77, which is only minor support. 76.60 was a cushion for the pair at the beginning of the year and is rather strong. 76.26 is the next line on the downside after working as a support quite some time ago. Steep Uptrend Support Broken As shown on the chart, USD/JPY finished riding on uptrend support, and when this ended, the fall was clear to see. I am neutral on USD/JPY. The yen benefited from the dovish meeting minutes. However, these hopes are slowly fading out. A disappointment from Ben Bernanke in Jackson Hole could push the pair back up. It’s important to remember that the US is still looking better than Japan in terms of growth, and that Japan doesn’t enjoy a trade balance surplus it usually had. 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 to 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 forecast For the Swiss Franc, see the USD/CHF forecast. 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 AUD/USD Forecast Aug. 27-31 Kenny Fisher 11 years USD/JPY completely reversed the previous moves and fell sharply, breaking uptrend support. Retail Sales, Tokyo Core CPI and Prelim Industrial Production are the main events this week. Here's an outlook for the Japanese events and an updated technical analysis for USD/JPY. Japan saw yet another month of deficit in its trade balance, yet the yen ignored it. What helped the Japanese currency was the release of dovish meeting minutes from the Fed's last meeting. Speculation about dollar printing weakened the dollar, and the yen didn't stop despite the doubts. 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