Fundamental view:

US dollar seemed to be stronger against the yen in the previous week. US dollar is heavily weighed upon by the stimulus situation in America, which seems to be getting more aggressive as Donald Trump is demanding even more stimulus for Americans.

US New Home Sales on 23^rd Dec and Japan Housing Starts yearly report on 25^th Dec created a bearish environment for the pair whereas Japan BOJ Core CPI yearly report on 22^nd Dec and Japan Tokyo Core CPI on 25^th Dec created bullish environment for the pair.

The major economic events deciding the movement of the pair in the next week are US Dallas Fed Manufacturing Index at Dec 28, US S&P/CS HPI Composite-20 y/y at Dec 29, US Pending Home Sales monthly report, US EIA Crude Oil Stocks Change at Dec 30, and US Initial Jobless Claims at Dec 31.

USD/JPY Weekly outlook:

Technical View:

Last week’s high was 0.25% lower than the previous week. Maintaining high at 103.89 and low at 103.25 showed a movement of 64 pips.

In the upcoming week we expect USD/JPY to show a bullish trend. The currency pair is trading above the 50 Simple Moving Average and the MACD trades to the upside. A solid breakout above 103.87 may open a clean path towards 104.20 and may take a way up to 104.51. Should 103.23 prove to be unreliable support, the USDJPY may sink downwards 102.92 and 102.59 respectively. In H4 chart, Formation of Ascending triangle pattern breakout indicates reversal of the trend creating prospects of a bullish trend Along with a bullish engulfing formation braces our expectation.