USDJPY Weekly Forex Forecast – 3rd to 7th Oct 2016

Technical Outlook: USDJPY has managed to find support above 100.00 psychological level and is poised to retest the previous resistance at 102.46. A breakout above this resistance could see further gains pushing USDJPY towards 104.00 resistance. To the downside, a breakout below 100.70 will signal near term declines towards 99.88. On the daily chart bear in mind the support zone of 100.48 – 99.88 which is the support level for the descending triangle. A breakout below this support could signal strong declines in USDJPY.

Fundamental Outlook: Economic data from Japan continues to disappoint with last week’s inflation sinking further. The week ahead will see the quarterly Tankan manufacturing and nonmanufacturing survey results which will be the main focus for traders. After starting the year on a weaker note, sentiment in the sectors remains broadly flat. However any surprise beat on the headline data could see the yen weaken strongly. At the same time a worse than expected print could immediately spark another bout of yen buying, worsening risk sentiment.

Price is heading up. Stochastics is also turning and moving up. This week USDJPY, we feel, might be heading up to test resistance and might just have enough power in it to break through. Of course, only time will tell but we are confident that this Bull might be strong enough to charge ahead.

USDJPY Weekly Forex Forecast – 3rd to 7th Oct 2016 – BULLISH