Expectations for the central bank of Japan (BOJ) to raise interest rates at next week's policy meeting continue to inject strengthening Yen.
The yen was strong against the US dollar at the beginning of the week until yesterday although the performance of the US dollar was seen as good against most major currencies.
The Bank of Japan (BOJ) surprised the market at its March meeting when it raised interest rates from negative levels that had been maintained since early 2016.
The yen's strengthening pattern appears to have continued for a third straight week after recovering from its worst fall since 1986 in early July.
As in the previous situation, the market saw intervention in the market but no indication was obtained from the Japanese authorities regarding the matter.
If observed on the chart of the currency pair USD/JPY, the price continued to decline lower today to pass the level of 155.00.
After the price rally last June continued into the opening of July which saw the price hit a 38-year high around 162.00, the price trend started to change with a decline leading up to this week.
Although the US dollar showed a good performance, it failed to raise the price again with the price movement remaining below the barrier line of the Moving Average 50 (MA50) on the 1st time frame on the USD/JPY chart as a bearish signal.
Further decline is expected to continue with a target of reaching around 152.00.
This will be the latest low of the price for the 12 month trading period.
However, if the price bounces back above the 155.00 level, it is likely that the bullish pattern will be displayed again.
Several resistances need to be overcome before signaling a trend change including around the 157.500 zone and further at 160.00.
See the picture of the price chart of the USD/JPY pair below for your technical analysis reference.
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