New high for dollar-yen but continuation depends on the BoJ
The dollar has generally strengthened against most major currencies since the beginning of March as expectations for the start of the Fed’s pivot have steadily moved back. There’s also the American economy’s overall good performance. GDP remains high and the chance of recession low while inflation and new jobs have consistently beaten the consensus for many months. Japan’s economy certainly isn’t doing terribly, but it’s the large divergence in rates which is one of the main drivers for the move up on this chart.
The 61.8% Fibonacci extension around ¥158 is a particularly obvious target in the medium term, but whether this is achieved depends on American advance GDP and the BoJ’s decision. The price did respect the 50% Fibo extension consistently until 10 April.
The overbought signal from the slow stochastic probably wouldn’t be too important by itself considering the fundamental situation, but combined with a declining ATR and having reached a new psychological area there’s the potential for a retracement or consolidation in the near future. The 20-day moving average is likely to remain an important dynamic support in the next few days. Below that, the 50% Fibo extension around ¥152 could be an important support.
Overall, this is uncharted territory: ¥155 is a 34-year high for dollar-yen. The uptrend is quite mature and the outlook for monetary policy is evolving constantly.
This is my personal opinion which does not represent the opinion of Exness. This is not a recommendation to trade.
The 61.8% Fibonacci extension around ¥158 is a particularly obvious target in the medium term, but whether this is achieved depends on American advance GDP and the BoJ’s decision. The price did respect the 50% Fibo extension consistently until 10 April.
The overbought signal from the slow stochastic probably wouldn’t be too important by itself considering the fundamental situation, but combined with a declining ATR and having reached a new psychological area there’s the potential for a retracement or consolidation in the near future. The 20-day moving average is likely to remain an important dynamic support in the next few days. Below that, the 50% Fibo extension around ¥152 could be an important support.
Overall, this is uncharted territory: ¥155 is a 34-year high for dollar-yen. The uptrend is quite mature and the outlook for monetary policy is evolving constantly.
This is my personal opinion which does not represent the opinion of Exness. This is not a recommendation to trade.