USDJPY on Friday rose 0.24% to 152.24. Week ending 2024-10-25 rose 1.77%. What’s going on.

USDJPY Analysis

Performance
Period	Pct	Chg	Momentum
Friday	0.24%	35.8 Pips
Week 242024-10-25	1.77%	264.399 Pips	October	5.94%	853.399 Pips

Upcoming key events for the new week (London Time)

Wed 12:30 PM GDP annual rate
Thu 03:00 AM Bank of Japan Short-Term Policy Interest Rate
Thu 12:30 PM Initial Unemployment Insurance Claims
Thu 12:30 PM PCE Price Index, excluding food and energy (12-mth)
Fri 12:30 PM Nonfarm Payroll Employment

What happened over the week

In the United States, the positive economic sentiment was reflected in several key metrics. The Index of Consumer Sentiment showed improvement, rising to 70.5 points in October from 68.9 points in September, as reported by the University of Michigan. This suggests a growing confidence among consumers. The Index of Consumer Expectations remained steady at 3% from last month. However, U.S. Durable Goods – New Orders experienced a setback, decreasing by 0.8% in September, according to the Census Bureau. The orders for durable goods excluding transportation fell to 0.4%, down from a revised 0.6% in August. On a positive note, nondefense capital goods orders, excluding aircraft, increased significantly to 0.5% in September. Initial unemployment claims also saw a noteworthy decrease to 227,000, marking an improving labor market condition.

In Japan, the inflationary trends showed mixed signals. The Tokyo Consumer Price Index excluding fresh food declined to 1.8% in October from 2% in September, as per the Statistics Bureau of Japan, indicating easing inflationary pressures. Conversely, the Tokyo CPI excluding fresh food and energy came in higher at 1.8% compared to 1.6% in the previous month, suggesting underlying pricing factors are contributing to inflation despite the decline in broader CPI. These figures might influence future monetary policies given the different components of inflation.

The USDJPY pair has been on a rise, increasing by 0.24% to 152.24, hitting a 12-week high. The strengthening of the USDJPY suggests that investors largely expect U.S. economic data to underpin the dollar’s strength, further supported by falling unemployment claims and consumer sentiment improvements. The upcoming high-impact events in the U.S., such as GDP data, nonfarm payroll employment, and PCE price index, are likely to further influence this currency pair. In contrast, Japanese economic data, focusing particularly on CPI, could lead to speculation regarding the Bank of Japan’s short-term interest rate decision. Overall, unless there is a significant policy shift, the additional momentum in U.S. dollar strength relative to yen softness could see USDJPY continue to trade at elevated levels.

From social media

🇯🇵 Japan's Tokyo CPI excluding fresh food and energy increased to 1.8% in October from 1.6% in September.https://t.co/tOIFtdsEF7

— Market Recap (@forexforum) October 27, 2024

What can we expect from USDJPY for the new week and what happened on Friday?

USDJPY on Friday rose 0.24% to 152.24. Price is above 9-Day EMA while Stochastic is rising. For the week ending ,2024-10-25, the pair rose 1.77% or 264.399 pips higher.

Looking ahead, USDJPY looks bullish as the pair ended higher after Friday trading session.

For the new week, our technical outlook looks bullish, immediate upside resistance level at 153.43 (WR1) with break above could target 154.62 (WR2). On the downside, we are looking at week low of 150.52 as an important support. Break below this level could weaken the current bullish momentum. A break above 153.16 would suggest bullish bias after recent positive movement.

For the month of October, USDJPY is up by 5.94% or 853.399 pips higher.

Weekly key levels to watch out:

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