remains near 156.83 on Friday. Despite increased volatility in recent sessions, the yen is expected to end the week virtually unchanged. Fears of intervention and firm rhetoric from Tokyo have failed to support sustained currency strengthening.
Japanese authorities have stated that they are not limited by the frequency of their interventions in the currency market and remain in constant contact with the United States. Previously, the yen rose sharply amid alleged interventions on April 30 and May 6, but there was no official confirmation of these actions.
Internal data has been stronger. Real wages rose for the third consecutive month, supporting expectations of further tightening by the Bank of Japan (BoJ).
However, the external context remains negative. A stronger dollar and tensions around the Strait of Hormuz continue to weigh on the yen.
Technical analysis
On the H4 chart, USD/JPY is trading within a consolidation range around 156.50 and moving towards 157.39. A test of this level is likely, followed by a possible pullback to 156.50 before a further bullish move towards 157.90. The MACD indicator supports this scenario, with its signal line below zero and pointing firmly upwards, indicating that bullish momentum is building.
On the H1 chart, USD/JPY has reached the level of 156.95 and is now retreating towards 156.50. A bounce towards 157.00 may follow, with a possible extension to 157.39. The stochastic oscillator confirms this view, with its signal line below 80 and pointing firmly towards 20, indicating that short-term bearish pressure persists.
Conclusion
The yen has stabilized near 156.83 against the dollar, but risks of intervention remain despite verbal warnings from Tokyo. Domestic wage growth supports the Bank of Japan's tightening expectations, but external factors such as the strong dollar and geopolitical tensions continue to weigh on the currency. Technically, a short-term rise to 157.39 can be followed by a pullback to 156.50 before any further rise develops.
By RoboForex Analysis Department
Disclaimer: Any forecast contained herein is based on the author's personal opinion. This analysis cannot be considered trading advice. RoboForex assumes no responsibility for trading results based on the trading recommendations and reviews contained herein.
