Yen Continues Its Strong Trend – USD/JPY Elliott Wave Analysis

Our previous note in February “Is Yen Ready To Dominate” forecasted a couple of things.

First, some hesitation may appear near 146-147 price range. In early March, USDJPY found some brief support at 146.53 and bounced for a few days.

Secondly, USD/JPY may be trending lower with an initial target of 139. Last week, USDJPY reached a low of 139.88, right on target.

Current Elliott Wave Forecast

USDJPY does appear to be in a bearish wave (iii) that is incomplete to the downside. Currently, USD/JPY is processing through previous support between 139.57 and 141.68. These support levels were formed in August and September 2024. (see yellow horizontal box)

The preferred wave count suggests USDJPY likely breaks this support shelf to stretch down to lower levels.

If the pair is successful in breaking lower, a temporary low would be the finishing touches to wave (iii) and lead to a bounce in wave (iv) that may carry it back up to the level of broken support.

All of this would eventually lead to a wave (v) lower that could target 128 and possibly lower levels.

Bottom Line

USDJPY is falling in wave (iii) of a five-wave impulse decline. Wave (iii) is forecasted to finish below 139.57 and possibly reach 132.

This entire impulse pattern that began in January 2025 is anticipated to decline to around 128.

It appears USDJPY may hold below 144.55. A print above 144.55 doesn’t void the count, but does begin to strain the viability of the forecast. We’ll begin to consider what alternatives may exist on a print above 144.55.

Short-Term Bias: Bearish

Long-Term Bias: Bearish

Key Level for Bearish Bias: 144.55

Initial Target: 132

Secondary Target: 128