24.10.202413:08 Forex Analysis & Reviews: USD/JPY. Analysis and Forecast

Today, following verbal interventions by Japanese officials, the yen is attracting buyers, partially recovering from its sharp decline against the US dollar. The slight pullback in the US dollar is drawing the USD/JPY pair back toward the key level of 152.00. However, uncertainties surrounding Japan's elections and doubts about the Bank of Japan's ability to raise interest rates this year are expected to limit the yen's recovery.

Moreover, expectations of the Federal Reserve continuing moderate rate cuts, along with concerns about post-election spending in the US, are likely to keep US bond yields high, which limits the dollar's decline. Signs of stability in the stock markets may further help to limit the rise of the yen, supporting the potential for buying on dips in the USD/JPY pair.

For a clearer understanding of the global economic outlook and short-term momentum in this currency pair, attention should be paid to the preliminary PMI data from the US.

Technical Analysis: A breakout above the alignment of the 100- and 200-day SMAs, followed by consolidation above the 200-day simple moving average (SMA), is considered a new trigger for the bulls. However, the subsequent upward movement has stalled just above the round level of 153.00, near 153.20, which has proven to be a barrier at the 61.8% Fibonacci retracement level of the decline from July to September, against the backdrop of a slightly overbought Relative Strength Index (RSI) on the daily chart.

The 153.20 barrier should now act as a key support point. If it is decisively overcome, it would pave the way for extending the upward trend. The USD/JPY pair would then aim to reach the round level of 154.00 and further rise to the supply zone at 154.30. The momentum could extend further toward the psychological threshold, with some resistance around the 154.75 zone.

On the other hand, any significant corrective decline will find solid support around the round level of 152.00. A convincing break below this level could pull the USD/JPY pair further down toward intermediate support at 151.40, tied to the 200-day SMA, and toward the round level of 151.00. However, this drop could present a buying opportunity. This level should limit the decline near the aforementioned alignment of the 100- and 200-day SMAs. Persistent weakness below this would indicate that the bullish momentum is exhausted, shifting the short-term bias toward the bears.