USD-JPY Weekly Prediction: Following the dollar and Treasury rates, March 29th – April 2nd

US Primary Jobless Claims and GDP data advance.

10-year Treasury rates slope on Thursday then recuperate.

USD-JPY returns to a 12-month peak on Friday.

USD-JPY sustained its consolidation earlier this week continuing below 109.25 confrontation, but Thursday's price ended just beneath this price set the stage for a calm navigate on Friday and a swift run to the 12-month peak.

The huge sustenance the Bank of Japan is providing to equity prices may be having the conflicting outcome on insight, belittling what little sureness exists in the Japanese economy.

American Initial Jobless Claims, the tell-tale of the covid-19 economy, plunged to their deepest level since March 13, 2020, the preceding week before the lockdown.

Two features are moving US rates higher;

Economic development in the US is projected to hasten this year. The Fed's Projection Materials amplified the 2021 GDP approximation to 6.5% GDP from September's 4.2%.

Inflation is also posed for a speedy increase with the Fed's favourite device, Core Personal Consumption Expenditure (PCE) Price index, mounting to 2.2% from 1.8% and the frontpage rate attaining 2.4% from 1.8% by the dusk of 2021.

USD-JPY Overview

The dissimilarity between the hopeful US economy and its likeness in Treasury rates and motionless Japan has been and holds as the currency pairs remark. The 6.9% ascent in the USD-JPY this year is, excluding the pandemic fear in March, the sharpest since the 14.7% hop from 103.02 in November 3, 2016 to 118.21 that December.

If the US economy achieves as predicted, Treasury rates could move significantly higher. With the BOJ dedicated to its ostensibly lasting zero rate policy, which impedes Japan's economic repossession rather than helping it, the yen will hold the self-protective for the abrupt future.

The zone above 110.00 was seriously traded from late 2016 until the mid-2019 and the lower supports will provide many openings for profitmaking.

Providing the rate deviation between the US and Japan continues to broaden, the USD-JPY will increase. The laidback triumph of resistance at 109.20 on Friday defines the course for the week ahead. Consolidation above the base at 109.20 is the probable technical preparation this week.

The two-bordering resistance at 110.00 and 110.30 are from January 2020 and of light impact. The identical pandemic highs from February and March would not offer significant resistance on their own but they overlap with ranges from 2019. Resistance above 110.30 will be much firmer to break and reverse to the base at 109.20 would not preclude the rising drive. Only an arrival at the 108.60-109.20 would dull the general course.

The Relative Strength Index at 75.70 is overbought but providing the pair holds above 109.20, it is not a sell signal. The nearest MA at 108.39 complements to support at 108.30. The 100day MA at 105.14 and the 200-day MA at 105.53 are out of the present technical depiction.

Resistance: 110.00, 110.30, 110.70, 111.00, 111.60

Support: 109.60, 109.20, 108.60, 108.30, 108.00