USD/JPY testing 150.40 ahead of Tokyo CPI inflation, markets hope for a hold at 2.5%

• The USD/JPY is trading into the high side above the 150.00 handle as markets dare the BoJ to intervene.
• Japanese Tokyo CPI inflation is forecast to hold steady.
• Friday to close out the week with US PCE Index figures.

The USD/JPY is trading into 150.40 as Japan's Tokyo Consumer Price Index (CPI) rounds the corner.

Tokyo Core CPI is expected to hold steady for the year into October at 2.5%, with the headline CPI inflation reading last showing 2.8 for the same period.

https://www.fxstreet.com/news/forex-today-dollar-stays-cool-despite-hot-us-economy-202310262041

The USD/JPY continues to trade into a price level that has seen the Bank of Japan (BoJ) take defensive measures in the past, and markets are keeping the Yen pinned to the floorboards as investors dare the BoJ to take action to defend the JPY.

The trading week will close out with Friday's US Personal Consumption Expenditure (PCE) Price Index, which is expected to tick upwards from 0.1% to 0.3% for the month-on-month figure for September.

USD/JPY Technical Outlook

On Thursday, the USD/JPY currency pair exhibited notable strength by surpassing the significant psychological threshold of 150. This extension of the prevailing upward trajectory underscores the bullish sentiment across various time frames, including the long-term, intermediate, and short-term perspectives.

The absence of discernible reversal signals in the market further supports the prevailing uptrend, instilling confidence in the probability of continued upward momentum. Notably, the next prominent price target resides at the 152.00 level, a level previously achieved in October 2022.

A technical analysis of the daily chart reveals the completion of what appears to be an ascending triangle pattern, followed by a breakthrough above the 150.16 highs recorded on October 3. It is worth noting that the breakout, as observed on Thursday, was not decisively pronounced, as indicated by the formation of a 'Doji' candlestick, reflecting a degree of market indecision. However, the overarching upward trend lends support to the expectation of a subsequent price appreciation.

In light of the technical analysis, the triangle's projected target is positioned approximately at the 152.00 level.

USD/JPY Technical Levels