USD/JPY: Profitable Strategies in Market Turbulence

The Japanese yen has strengthened slightly in response to verbal intervention by Japanese authorities. The daily chart shows an upward movement of the pair, with 151.00 as the next resistance level, followed by last year's high of 151.91. USD/JPY reached a three-month peak at 150.81 after the US Bureau of Labor Statistics reported further confirmation that inflation remains above 3%, albeit slowing down. January's inflation rate exceeded expectations, rising by 3.1% compared to the previous month's 3.4%. Excluding volatile elements, Core CPI remained steady at 3.9% compared to the previous month. Following this data, USD/JPY continued its rise, surpassing 150.00, supported by US Treasury yields. The CME FedWatch indicates that traders seem to be ignoring the possibility of rate cuts in March and May, focusing instead on June. Meanwhile, the Bank of Japan has shown uncertainty regarding its monetary policy. Although the data suggest potential sustained inflation, uncertainty persists. The Bank of Japan may delay its exit from negative rates. Japanese authorities are ready to intervene in the foreign exchange market if necessary, as reiterated by Masato Kanda and Finance Minister Shunichi Suzuki. The CPI index in the United States exceeded expectations, prompting investors to reconsider their plans for rate cuts and market intervention. We will see what the upcoming data reveal; in the meantime, happy trading to all.

Comment:

The BOJ is ready to raise the rates, I'm ready for a short.

Comment:

On USDJPY, we have 2 possible scenarios: one long towards 155 and one short towards 145. It will be crucial to look for a significant movement near the lower side of the bullish channel.