According to media reports, the Japanese government is in the final stages of preparing an economic stimulus package worth 21.3 trillion yen (USD 135.38 billion) to help households cope with persistent inflation. This could become the largest stimulus since the COVID pandemic.

The Cabinet plans to approve the package on Friday, and the supplementary budget to fund it on 28 November, aiming to secure parliamentary approval before the end of the year.

This decision has led to a significant weakening of the national currency.

Technical Analysis of the USD/JPY Chart

Fluctuations in the Japanese yen against the US dollar are forming an upward channel (shown in blue), and the fundamental backdrop this week has caused the price to:

→ break the QL line from below (and after the breakout, the rise accelerated, indicating imbalance — forming a Fair Value Gap pattern);
→ reach the median.

It is reasonable to assume that around the median, supply and demand may balance each other, stabilising the market. It is also possible that the FVG area will act as support in the event of a correction.

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