Is USD/JPY poised to break higher?

After being stuck in a sequence of lower highs over the past four years, traders are watching to see if USD/JPY can break higher.

The US dollar was once worth ¥125.00. That was back in mid-2015, when the Fed was beginning its tightening cycle. It proved to be the peak for USD/JPY for the next few years. In the following 12 months, the currency pair fell to ¥100.00. While it has had periods of sustained recovery since then, the overall trend has been lower, with lower highs in December 2016, November 2017, October 2018, April 2019 and, potentially, January 2020.

Is change in the offing?

But perhaps things are about to change. Over the past few weeks the price has stabilised above ¥108.00, and seems poised to challenge trendline resistance once again. A rally above ¥110.00, the peak from January, would mark a long-term bullish development, and suggest that, in the near-term at least, a rally to ¥114.00 and the resistance zone from 2017-2018 was now in play.

If nothing else, the price has shown, since early 2018, a distinct unwillingness to move below ¥104.80. The price has held support three times at this level, and crucially the last bounce from here also coincided with a bounce from trendline support, as a rising trendline from the June 2016 low came into play. If ¥104.80 is broken, then a more bearish view develops, with the 2016 lows at ¥100.00 the next big levels to look out for.

IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.

Please see important Research Disclaimer.

Start trading forex today

Trade the largest and most volatile financial market in the world.

  • Spreads start at just 0.6 points on EUR/USD
  • Analyse market movements with our essential selection of charts
  • Speculate from a range of platforms, including on mobile

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.


Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.

The Momentum Report

Get the week’s momentum report sent directly to your inbox every Monday for FREE. The Week Ahead gives you a full calendar of upcoming key events to monitor in the coming week, as well as commentary and insight from our expert analysts on the major indices to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.