【Dollar-Yen】This week did not move｜Next week there is a possibility of a large move due to a rebound

The USD/JPY is currently around 159.2.

This week ultimately was a market that didn’t move much. It stayed in a tight range around 159, unable to break above or below.

But after a week of “consolidation” like this, next week often moves a lot. Energy is building up.

Signs of downside pressure seen on the daily chart

Please look at the daily chart.

From 160 to 155, it fell, then rebounded to 159, and has since stagnated again. This pattern looks like a “resting area before the next drop begins after a pullback.”

The moving average is also approaching flat. If it turns downward from here, the downward trend could accelerate again.

Long position holders should be cautious in this phase.

Preliminary target is the lower half of 158

If a pullback comes next week, the first area to watch is the lower half of 158.

This level has recently functioned as support several times. It’s a point where sellers take profits and buyers step in.

There is a good chance of a strong rebound from the lower half of 158. But I don’t view that as a signal that the decline is over.

Even if it rebounds, ultimately yen will strengthen

As I’ve written many times, I’ll say it again.

Even if it rebounds from the lower half of 158, I view that rebound as a “pullback within the downtrend.”

The presence of the 160 triple top, the “Higashi window” (148–149), the Bank of Japan rate-hike stance, and expectations of U.S. rate cuts—all of these elements have not changed.

There may be short-term fluctuations up and down, but the overall trend is toward a stronger yen. This view remains unchanged.

Strategy for next week

If you’re holding a long position for a while, the basic stance is to stay short.

・Enter shorts by positioning around the upper half of the 159–160 range
・If it falls to the lower half of 158, consider taking profits temporarily
・Rebound longs around the lower half of 158 should be short-term only. Do not chase
・In a range-bound market, don’t force-position

When the market isn’t moving like this week, do nothing. When it starts moving next week, ride the momentum. There’s no need to rush.

Summary

・This week was almost flat. Next week may move sharply on a reaction
・Signs of downside pressure appear on the daily chart. Longs, beware
・Target is the lower half of 158
・Even if it rebounds, the overall direction remains toward yen strength
・Basic stance is to stay short. This view remains unchanged

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