USDJPY: Can the market maker end the rally?
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USDJPY is retracing after receiving support from bullish sentiment around 146.50-146.30. Currently, the uncertainty surrounding BoJ's policy moves and the US dollar's renewal demand are positive signals for this currency pair. However, the market is preparing for a series of important US economic data, which could bring unpredictable price fluctuations.
Today, the market will receive Retail Sales figures, and if they are optimistic, it will indicate strong consumer spending, which could boost expectations of the Fed maintaining unchanged interest rates in the first half of this year. This supports further consolidation for USD/JPY.
The daily chart shows that USDJPY is experiencing a bearish reaction around the 0.5 and 0.618 Fibonacci levels. I am quite optimistic that USD/JPY will react similarly, as careful observation reveals that USDJPY is facing resistance from a head and shoulders pattern, accompanied by a descending handle. Therefore, breaking the psychological support level at 146.00 will provide momentum for lower levels. It is expected that USDJPY will decline after touching 148.69-148.17 and testing the 34.89 EMA.
USDJPY may experience a reaction after bouncing off the support level. Price consolidation below this level shows that the market is ready to fall deeper.
USDJPY is retracing after receiving support from bullish sentiment around 146.50-146.30. Currently, the uncertainty surrounding BoJ's policy moves and the US dollar's renewal demand are positive signals for this currency pair. However, the market is preparing for a series of important US economic data, which could bring unpredictable price fluctuations.
Today, the market will receive Retail Sales figures, and if they are optimistic, it will indicate strong consumer spending, which could boost expectations of the Fed maintaining unchanged interest rates in the first half of this year. This supports further consolidation for USD/JPY.
The daily chart shows that USDJPY is experiencing a bearish reaction around the 0.5 and 0.618 Fibonacci levels. I am quite optimistic that USD/JPY will react similarly, as careful observation reveals that USDJPY is facing resistance from a head and shoulders pattern, accompanied by a descending handle. Therefore, breaking the psychological support level at 146.00 will provide momentum for lower levels. It is expected that USDJPY will decline after touching 148.69-148.17 and testing the 34.89 EMA.
USDJPY may experience a reaction after bouncing off the support level. Price consolidation below this level shows that the market is ready to fall deeper.
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Comment:
USDJPY may remain well supported amid improving Japanese inflation and weak economic activity suggesting the BoJ is unlikely to normalize policy rates more than currently priced in 2024
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