Fundamental view:

Greenback showed a uptrend against the Japanese yen in this week despite somewhat conflicting directions from US economic data. Consumer price gains in the US have moderated slightly in August and gave the Federal Reserve additional logic for delaying their bond taper. Whereas Federal Reserve policy as enumerated many times by Chair Powell, focused exclusively on the labor economy restoring to its condition before the pandemic. On the other hand, Japanese data produced no major surprises. Exports in August were weaker than forecast but imports were higher.

Japan BSI Large Manufacturing on 13th Sep and US Business Inventories monthly report on 16th Sep created uptrend whereas US CPI monthly report on 14th Sep and US Michigan Current Conditions on 17th Sep created downtrend for the pair.

The major economic events deciding the movement of the pair in the next week are US Building Permits at Sep 21, BoJ Interest Rate Decision, US EIA Crude Oil Stocks Change, Fed Interest Rate Decision at Sep 22, US Initial Jobless Claims at Sep 23, Japan Markit Manufacturing PMI and Fed Chair Powell Speech at Sep 24.

USD/JPY Weekly outlook:

Technical View:

Last week’s high was 0.26% lower than the previous week. Maintaining high at 110.15 and low at 109.10 showed a movement of 105 pips.

In the upcoming week we expect USD/JPY to show a bullish trend. The currency pair is trading above the 200 Simple Moving Average and the MACD trades to the upside. A solid breakout above 110.37 may open a clean path towards 110.79 and may take a way up to 111.42. Should 109.32 prove to be unreliable support, the USDJPY may sink downwards 108.69 and 108.27 respectively. In H4 chart, Formation of rounding bottom pattern indicates reversal of the trend creating prospects of a bullish trend Along with a hammer formation braces our expectation.