29.03.2023 08:39 AM
USD/JPY: downtrend seems over, larger rebound needs confirmation

The USD/JPY pair turned to the upside in the short term and it's trading at 131.80 at the time of writing. Still, a larger rebound needs confirmation as the rate stands below important resistance levels.

Fundamentally, the Japanese BOJ Core CPI rose by 2.7% versus 3.0% growth expected yesterday. On the other hand, the US reported mixed data. The CB Consumer Confidence was seen as a high-impact event and it was reported higher at 104.2 versus 101.0 forecasts, boosting the USD.

USD/JPY Challenges 131.74!

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Technically, the USD/JPY pair found support at 129.79 and now it has jumped above the downtrend line. It is challenging 131.74 and is almost to reach the median line of the ascending pitchfork.

It remains to see how it reacts around the median line (ml). After its strong growth, false breakouts may announce a potential drop towards the weekly pivot point of 131.11.

USD/JPY Forecast!

A valid breakout above the median line (ml) and most important through the R1 (132.59) activates a larger growth and is seen as a buying signal. The upper median line (uml) is seen as an upside target.

Ralph Shedler,
Analytical expert of InstaForex
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