USDJPY: the yen continues to strengthen against the USD

Amid economic data from the US and Japan, the USDJPY rate may continue its downward trajectory towards 150.90 after a correction. Find more details in our analysis for 10 February 2025.

USDJPY forecast: key trading points

• Japan’s bank lending: previously at 3.0%, currently at 3.0%
• US Michigan inflation expectations: previously at 3.0%, projected at 3.0%
• USDJPY forecast for 10 February 2025: 153.00 and 150.90

Fundamental analysis

Fundamental analysis for 10 February 2025 shows that Japan’s bank lending remained unchanged at 3.0%. Given some stabilisation in the credit sector, today’s USDJPY forecast is not in favour of the US dollar.

According to the forecast for 10 February 2025, US Michigan inflation expectations may remain flat at 3.0%. It is worth noting that the indicator has ranged between 2.6% and 2.7% for several months before growth. The actual data remaining unchanged from the previous reading may be considered a neutral signal, indicating some stabilisation in the US economy. At the same time, a weaker-than-expected reading may impact the USDJPY rate, helping the yen strengthen.

USDJPY technical analysis

Having tested the lower Bollinger band, the USDJPY price has formed a Hammer reversal pattern on the H4 chart. At this stage, it continues to correct following the pattern signal. Before that, the quotes have rebounded from the support level and are moving within the ascending channel, so they are expected to rise to the resistance level.

The target for a pullback is currently the 153.00 level. A rebound from this level could pave the way for a more substantial downward movement.

However, an alternative scenario is possible, where the price plunges to 150.90 without testing the resistance level.

Summary

Coupled with the USDJPY technical analysis, the US and Japanese fundamental data suggests a potential decline to the 150.90 level.