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Both the Fed and BOJ are giving new policy guidelines this week!

Will this week’s events push USD/JPY to an upside breakout?

I’m looking at the 4-hour chart’s consolidation!

USD/JPY: 4-hour

USD/JPY 4-hour Forex Chart

USD/JPY 4-hour Forex Chart

A slightly lower-than-expected consumer sentiment report pulled USD/JPY from its weekly highs last Friday.

The pair is now trading closer to 143.00, which lines up with a trend line support that has been around all month.

Based on the higher lows, USD/JPY might also be trading inside an ascending triangle on the 4-hour time frame.

Will the trend line retest lead to new 2022 highs for USD/JPY?

All eyes will be on the Fed’s policy announcement and a new set of projections this week.

Aside from a 75-basis-point interest rate hike, markets expect the Fed to upgrade its dot plot projections to reflect higher interest rates at the end of 2022.

Meanwhile, the Bank of Japan (BOJ) isn’t expected to make any policy changes though some members might attempt to jawbone their rapidly weakening currency.

Unless we see fresh catalysts that can drag the dollar low and make it stay low, traders will probably continue to buy USD/JPY.

The pair could bounce from its trend line support and retest its 145.00 triangle resistance. It might even break higher and head towards 150.00!

This content is strictly for informational purposes only and does not constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to make sure you understand the risks involved.