The Japanese yen has reached the price level of December 17, 2018. The Japanese currency continues weakening and it is expected to reach the extreme overbought level of 113.28 in the next few hours.

The Japanese yen is very weak due to expectations that the Fed would start reducing its bond purchases in November, together with the increase in interest rates in 2022. This data has worked against USD/JPY and for this reason, we observe an increase to the levels of 2018.

According to the 1-hour chart, the USD/JPY pair has a strong upward trend, and according to the Eagle indicator, it could be reaching an overbought level of around 95 points. Therefore we must expect the rise to continue to 113.28 which is +2/8 of Murray. If it fails to break and consolidates below this level, it will be a good opportunity to sell with a target at 112.50.

Our forecast is to sell below 113.28 with targets at 112.89 and this could fall to the key support of 8/8 of Murray (112.50) at this same level is located the SMA of 21, which also adds strength to support.

If the yen falls to the 21 SMA around 112.50, it will be a bullish signal, you can buy again with targets at 112.89 and 113.28. The oscillator of the Eagle indicator is moving above a bullish channel which supports our forecast to buy around this level.

The outlook in the short term and the medium term, continues to be bullish for the USD/JPY pair, as long as it remains in daily charts above the 200 EMA located at 109.05, the upward movement should continue, in the short term it could have a correction to break free of the overbought and then resume its bullish path.

Support and Resistance Levels for October 11 - 12, 2021

Resistance (3) 114,14

Resistance (2) 114,06

Resistance (1) 113,19

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Support (1) 112,70

Support (2) 112,50

Support (3) 111,98

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A trading tip for USD/JPY for October 11 - 12, 2021

Sell in case of a pullback at 113,28 (+2/8) with the take profit at 112,89 and 112,50 (SMA 21), the stop loss is above 113,65.