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The Elliott Wave analysis for USD/JPY suggests a continuation of an impulsive upward trend initiated from a theoretical low on January 28, 2026. Wave (1) concluded at 157.72, followed by a corrective pullback in wave (2) ending at 152.25. The current wave (3) is developing as an extended impulsive structure, indicating potential for further gains. Technical indicators suggest the pair remains in a bullish phase, with key resistance levels likely to be tested in the coming weeks. For traders, this analysis highlights strategic entry points for long positions, particularly as wave (3) typically exhibits strong momentum. The USD/JPY pair is sensitive to global risk appetite and monetary policy differentials between the Fed and the Bank of Japan. A breakout above critical resistance could trigger broader market participation and attract algorithmic trading flows. The implications for forex markets are significant, with potential spillover effects into other yen pairs and commodities priced in USD. Traders should monitor the BoJ's policy stance and U.S. inflation data for confirmation. Key levels to watch include the 157.72 psychological barrier and the 160.00 psychological round number, which could determine the next phase of the trend.
