Forecast of the Yen from a technical perspective
According to Lao Dong, last week, the USD/JPY exchange rate (US Dollar against Japanese Yen) decreased sharply and is currently trading near its lowest level in many months. This reflects the appreciation of the Yen and the decline of the US Dollar.
According to FXStreet, analysts from UOB Bank said that if the exchange rate continues to decline and breaks the important support level of 145.00, the USD will likely continue to weaken against the Yen.
According to the short -term assessment (24 hours), after the USD drops rapidly in the last two sessions, the exchange rate is now over -selling - that is, a short decline in a short time. Therefore, the possibility of further reduction today is not high. The USD is expected to fluctuate in the region of 145,20–147.50. However, if the exchange rate continues to maintain below 149.40, the weak trend of USD can continue.
In the medium term (1-3 weeks), UOB experts believe that the current decline may not stop, although the USD is in an over-selling state. In the session on April 3, the USD fell to 2.13% - the largest daily decline since December 2023 - and closed at 146.6.00.
The 145.00 mark is currently considered a very important support threshold. If the USD breaks and stays below this threshold, the decline could continue to fall further. Conversely, if it rises back above 149.00, it could be a sign that the USD has stabilized again.
Yen appreciates thanks to global instability
The weakness of the USD also comes from the market psychology concerned about the economic impact of new tax policies proposed by former US President Donald Trump. At the same time, investors expect the US Federal Reserve (Fed) to cut interest rates soon due to the economy with signs of slowing down. These factors reduce the power of the dollar.
Meanwhile, the Japanese Yen still retains its role as a safe haven asset, especially when the global financial market is volatile and the risk of a trade war is still present. In addition, expectations that the Bank of Japan (BoJ) will continue to raise interest rates in 2025 due to widespread inflation are also actively supporting the Yen.
