Community Forecasts for March 31-April 4: USD/JPY 1W Chart

Source: Dukascopy Bank SA
© Dukascopy Bank SA
It finally happened. On Tuesday, April 1, during the Fool's day, Japanese government raised its consumption tax to 8% from previous 5%. For months analysts and policymakers were trying to predict whether the world's third largest economy is strong enough to withstand the potential burden. There are no economic data releases this week from Japan, while on April 8 the Bank of Japan is holding a press conference, where the will most likely try to assure markets they are ready to act if necessary. Analysts believe May's policy gathering will be the most appropriate time for Kuroda to expand his already unprecedented stimulus. But for now, traders can price in stimulus from the BoJ and the upcoming rate hike from the Fed, pushing the USD/JPY pair higher. 
In a long-term the pair is projected to appreciate, while this week's outlook is bullish as well. This idea is supported by 75% of Dukascopy Community members, who believe the pair will hit 102.86 by this Friday, a level which is slightly above last week's average price of 102.30. Some traders, however, are having even more positive outlook, as Juandata believes "there is a strong resistance at 103.7 and an important demand area at 101.2. I think the pair should continue its path towards 104, so a bullish week is expected. Maximum could be around 103.4, and weekly close at 103.10." In contrast, Tommaso claimed the pair will move back to 102 level due to a low value of Chaikin volatility. 
As it has been already mentioned, there is a lack of fundamental news from Japan, hence, the pair will be mostly driven by news from the United States. The pair can be highly volatile on Thursday, after a release of the U.S. trade balance and non-manufacturing PMI. Moreover, Friday's report from the Bureau of Labor Statistics will unveil the unemployment rate, which was earlier considered as the threshold for the Fed. 

© Dukascopy Bank SA

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