USDJPY extends gains above moving averages and former 40-year high, with 161.95 as critical support. Traders eye 162.70 and 162.83 for next targets.
USDJPY Rallies Above Key Moving Averages, Eyes Further Upside
The USDJPY pair is trading higher on the day, extending its position above the 100-hour and 200-hour moving averages at 161.83 and 161.98, respectively. The rally has pushed the pair above the former 40-year high from 2024 near 161.95, a level now acting as critical support. Today's low at 162.07, just above the breakout point, saw renewed buying interest, reinforcing the bullish bias as long as the price remains above 161.95.
A move back below this level could signal a failed breakout, potentially opening the door for deeper downside momentum. Conversely, if buyers defend the zone, the next upside targets include today's high of 162.70 and last week's record high at 162.83. A break above 162.83 would strengthen the bullish outlook and suggest further gains.
Recovery Follows Sharp Reversal
The rebound follows a sharp reversal last week, when USDJPY tumbled from a fresh 40-year high at 162.83 to a low of 160.45. However, the recovery, now in its fourth consecutive day, has nearly retraced the entire decline, highlighting persistent demand for the pair. This resilience underscores the importance of the 161.95 support level in maintaining the technical bias.
Risk Sentiment and Intervention Concerns
Traders remain cautious amid the ever-present risk of comments or intervention from Japanese officials. While the pair's technical momentum is intact, external factors such as monetary policy signals or geopolitical developments could influence future price action. Having a well-defined risk level, particularly around 161.95, remains essential for managing exposure.
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Risk warning
Trading Forex and CFDs carries a high level of risk and may not be suitable for all investors. You may lose more than your initial investment. Past performance is not indicative of future results. This site is informational and does not constitute investment advice.