USD/JPY Rebounds by Nearly 4% as Focus Shifts to Upcoming Economic Data
The USD/JPY currency pair has rebounded by nearly 4% since its September low, marking a sharp reversal from its yearly highs. The recovery is gaining momentum, with the weekly RSI attempting to reclaim neutral territory for the first time since early August.
The rally is approaching a major technical confluence that could determine whether the post-intervention decline remains intact. This zone converges at 159.75, where buyers will need to prove they can sustain the advance. A breach or weekly close above this threshold would be needed to fuel the next leg of the rally.
The focus is now on the evolving U.S., Japan policy differential, with key economic data releases scheduled for next week. Core PCE on Wednesday and Japanese CPI on Thursday will help shape expectations for the Fed's reaction function and the BOJ's tightening bias, respectively.