Japanese Yen Weekly Technical Forecast: Mixed

• USD/JPY recovers after CPI sell off – approaching the yearly high
• AUD/JPY: Lack of trend presents ranging opportunities

USD/JPY Recovers After CPI Sell-off

USD/JPY has more than recovered from the post CPI dollar sell-off which saw the pair trade towards 131.35. Since then, the pair has recovered to trade above 133.20, 135 and 135.60. Friday marks the 4th day of consecutive rises upon renewed momentum. The MACD indicator confirms the momentum as the MACD crossed above the signal line and now approaches the 0 line.

Price action may find it difficult to advance above 136.89 as this is current resistance. Early trading in the week to come should provide an indication if the pair is likely to approach the July high of 139.40. One early indication that there may still be some room to the upside is the RSI indicator, which has some way to go before breaching overbought levels.

USD/JPY Daily Chart

Source: TradingView, prepared by Richard Snow

AUD/JPY: Lack of Trend Presents Ranging Opportunities

AUD/JPY has shown a distinct lack of directional bias and continues to trade in a sideways manner. The pair has come short each time it has tried to retest the June high of 96.90 and has actually made lower highs in the process and if we include the spike lower on August the 2nd has made lower lows too.

However, when taking a step back and observing the closing prices, AUDJPY is far from a downtrend. Friday’s price action revealed an attempt to trade above 94.30 but encountered some resistance around that level. A number of upper wicks in this region on the daily chart hint that this may be a level where bullish exhaustion sets in.

AUD/JPY reveals a number of well-defined levels as weekly support and resistance. Support lies at the 92.60 level followed by the wick lows around 91.50. Resistance comes in at 94.30, then 94.75, followed by 94.75.

AUD/JPY Daily Chart

Source: TradingView, prepared by Richard Snow

— Written by Richard Snow for DailyFX.com

Contact and follow Richard on Twitter: @RichardSnowFX