Weekly Chart USD/JPY Update: Retracing the September rally

Consolidation within the 158.50/157.00 area has given way to sharp losses to retest support at the 156.50/156.00 area. Break here will confirm a double top at the 159.00 highs and open up room for deeper pullback to retrace gains from the September low.

Losses to break the 156.00 level will open up room for retest of strong support at the 155.20/155.00, August and May lows. Break of these lows will return focus to the 152.90 September low. Below the latter will extend the losses from the 164.00 July current year high and turn focus to strong support at the 152.10/152.00, January YTD low and 2023/2024 year highs. Losses through these will see potential for deeper pullback to channel support at 148.50 from the 2023 year low. 

Meanwhile, resistance at the 157.00/157.50 area are expected to cap. Regaining this needed to ease the downside pressure and see scope for retest of the 158.00 resistance then the 159.00 highs.