The price chart of the USD/JPY currency pair came into focus as the price surge took place yesterday, seeing the critical zone at ¥150.00 breached.
The story that happened in the New York session yesterday, the United States (US) inflation data has been published and this is an important indicator for the US central bank, the Federal Reserve (Fed) in setting their monetary policy.
Data readings showed inflation in the US was still high in January and still suggested the Fed would maintain existing policy rather than cut interest rates.
Thus, this has had a significant strengthening effect on the US dollar, putting pressure on other major currencies in the New York session yesterday, including the Yen.
However, investors are also keeping an eye on the Yen following a signal by the central bank of Japan (BOJ) to start raising interest rates, which have been kept at a low level of -0.10% for a long time.
Observing the movement of USD/JPY, the price is seen to continue its upward trend until yesterday's surge has penetrated the 150.00 zone.
The latest high was reached at the end of the New York session around 150,900, which is a 13-week record high.
However, a slow decline in prices was seen in the Asian trading session this morning (Wednesday) to around 150,500.
Expectations for the bullish price trend that will continue will target up to the level of 151.900.
That was the highest price tested in mid-November trading last year after the last time prices reached that level since October 2022.
For the forecast for the price drop, the 150.00 zone is seen to invite a price reaction to give an indication of further movement.
If the price breaks down again, this becomes a bearish signal for the possibility of a lower price drop.
The closest target after breaking through the 150.00 zone is for the price to go into the next zone around 149.00.
