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• The USD/JPY currency pair appeared to be stuck to the 141.00 level as markets moved towards 2024.
• The greenback shed a third of a percent against the yen on the last Friday of 2023.
• The USD/JPY pair was down a full percent on the week, but up 7% on the year.

The USD/JPY currency pair was back in the 141.00 handle as the duo struggled to accelerate momentum in either direction as markets closed up the 2023 trading year. Post-holiday markets saw a thin week ahead of the New Year’s long weekend, and the US dollar was down 0.3% against the Japanese yen for the last Friday of the trading year, shedding a full percentage point on the week.

US economic data seemingly continued to miss the mark with the US Chicago Purchasing Managers’ Index (PMI) printing below expectations on Friday, coming into at a contractionary 46.9 in December compared to November’s 18-month peak of 55.8, well below the median market forecast of 51.0.

Steepening misses in US data figures may be counter-intuitively supportive of broad-market risk appetite, with investors expecting souring economic outlooks across the globe to help to push the Federal Reserve towards a faster pace of rate cuts in 2024.

USD/JPY Technical Outlook

As the USD/JPY currency pair has been up around 7% on the year compared to being in the red for the month of December, the last few trading weeks of 2023 have been particularly dollar-negative, and there is little technical reason for the trend to reverse direction heading into 2024.

The pair etched in a yearly high of 151.91 in November, coming within inches of October 2022’s peak bids of 151.94 before slumping back toward the 140.00 major handle.

The USD/JPY pair has closed in the red for all but one of the last seven consecutive trading weeks, and the pair has been extending a push into bear country on the south end of the 200-day Simple Moving Average (SMA) near 143.00.

USD/JPY Hourly Chart

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USD/JPY Daily Chart

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USD/JPY Technical Levels

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