empty
24.03.2025 02:20 PM
USD/JPY. Analysis and Forecast

This image is no longer relevant

At the start of the week, following the release of a weaker Japanese PMI, the yen came under pressure. This, combined with news of narrower and less aggressive retaliatory tariffs from U.S. President Donald Trump, has boosted investor confidence and reduced demand for the yen as a safe haven. However, expectations that the Bank of Japan will continue to raise interest rates are capping deeper losses for the currency.

According to preliminary estimates, the Au Jibun Bank Manufacturing PMI in Japan fell from 49.0 to 48.3 in March, marking the lowest reading since March 2024 and a nine-month low. It also highlights a decline in the services sector, which contracted for the first time in five months. These data weigh on the yen.

Nevertheless, there are factors supporting the yen and preventing deeper losses—such as BoJ Governor Kazuo Ueda reaffirming the central bank's readiness to adjust its easing policy if inflation reaches the target level. Deputy Governor Shinichi Uchida also stated that the Bank will closely monitor economic and price developments. This signals that the BoJ will act in accordance with economic conditions.

Meanwhile, the Federal Reserve raised its inflation forecast but maintained its outlook for two 25-basis-point rate cuts by year-end. This limits the U.S. dollar's recovery and caps USD/JPY movement near the psychological level of 150.00.

For better trading opportunities today, attention should be paid to the release of U.S. business activity indices and speeches from FOMC members, which may provide additional momentum for USD/JPY. However, the market's primary focus will be on Friday's releases of the Tokyo Consumer Price Index and the U.S. Core PCE Price Index.

From a technical perspective, USD/JPY bulls need to break above the 200-period Simple Moving Average (SMA) on the 4-hour chart, which lies just above the psychological level of 150.00. If this level is breached, spot prices may rise toward the 151.00 round figure and then to the monthly high near 151.30.

However, considering that oscillators on the daily chart have yet to show positive momentum, the Asian session low around 149.33 is currently acting as immediate support ahead of the 149.00 round number. A drop below this level could trigger a break of the 148.60 area, opening the door to deeper losses, with an accelerated decline toward last week's swing low around 148.20 and eventually toward the 148.00 round level, or potentially lower.

Irina Yanina,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

Opposition to Trump Within the U.S. Intensifies (Potential for Continued Growth in #SPX and #NDX)

Domestic opposition to Donald Trump is gaining momentum, which could be an unpleasant surprise for the former president. This development may limit his efforts to reshape the U.S. economic landscape

Pati Gani 09:49 2025-05-29 UTC+2

What to Pay Attention to on May 29? A Breakdown of Fundamental Events for Beginners

Very few macroeconomic reports are scheduled for Thursday. The macroeconomic event calendars for Germany, the United Kingdom, and the Eurozone are empty. Only the United States will release reports

Paolo Greco 06:58 2025-05-29 UTC+2

GBP/USD Overview – May 29: The Dollar Begins to Believe in Miracles

On Wednesday, the GBP/USD currency pair traded with a slight decline, but it's hard to believe in further strengthening the U.S. dollar under the current circumstances. On the one hand

Paolo Greco 03:32 2025-05-29 UTC+2

EUR/USD Overview – May 29: Laughable or Lamentable? Trump Promises a Deal Again

The EUR/USD currency pair did not perform as well for the dollar on Wednesday as it did during the previous two days. However, even Monday and Tuesday can hardly

Paolo Greco 03:32 2025-05-29 UTC+2

NZD/USD. Hawkish Rate Cut: The Reserve Bank of New Zealand Concludes Its May Meeting

As expected, the Reserve Bank of New Zealand (RBNZ) lowered the interest rate by 25 basis points to 3.25% following its May meeting. This marks the sixth round of monetary

Irina Manzenko 00:31 2025-05-29 UTC+2

The Yen Saws Off the Branch Under the Dollar

When you begin dismantling a system, you risk cutting off the branch you are sitting on. For decades, the United States' main trading partners earned money by exporting goods

Marek Petkovich 00:30 2025-05-29 UTC+2

The Euro Is Rushing Things

After a rapid rally from February through April, EUR/USD entered a prolonged consolidation phase. For several weeks now, the major currency pair has remained locked within the 1.1100–1.1400 trading range

Marek Petkovich 18:43 2025-05-28 UTC+2

USD/CAD. Analysis and Forecast

The USD/CAD pair has been recovering for the third consecutive day from this year's lowest level, supported by renewed buying interest in the U.S. dollar. Yesterday's optimistic U.S. economic data

Irina Yanina 11:44 2025-05-28 UTC+2

DXY: U.S. Dollar Index Continues to Show Positive Momentum for the Second Day in a Row

On Wednesday, the U.S. Dollar Index (DXY) continued its upward momentum for the second consecutive day, rebounding from the monthly low reached earlier this week. The index rose

Irina Yanina 11:36 2025-05-28 UTC+2

Why Are Currencies Traded Against the Dollar Not Declining? (There Is a Chance EUR/USD May Resume Growth and USD/JPY May Fall)

We are truly living in an unusual time, where the classic principles of assessing market situations are being cast aside in favor of more pressing and, more importantly, unclear

Pati Gani 10:05 2025-05-28 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.