Tue, May 21, 2024

USD/JPY Nears 152 Amid US Jobs Data Anticipation

USD/JPY economy, Japanese Yen Rose Against U.S. Dollar Due to Risk-off Wave

Quick Look:

  • USD/JPY approaches 152.00, with support at 151.20, hinting at further gains.
  • Technicals show USD/JPY bullish above 150.50, with critical supports at 151.20 and 150.65.
  • Market watchers for potential Japanese intervention around the 155.00 level.
  • Upcoming U.S. jobs report critical for currency and interest rate directions.

The USD/JPY pair has made significant headlines as it rallied toward the 152.00 threshold before entering a period of consolidation. A robust bullish trend has underpinned the pair’s movements. Key support appeared at 151.20 on the 4-hour chart, signalling the potential for further upside.

U.S. Dollar to Japanese Yen: Continued Bullishness

The technical landscape for USD/JPY outlines critical resistance levels at 151.80, 152.00, and 153.20, with support tiers firmly placed at 151.20, 150.65, and further down at 150.00 and 148.50. The currency pair has notably secured a position above the 150.50 level, maintaining a bullish stance above the 100 and 200 simple moving averages on the 4-hour chart. However, a retreat below the 150.65 support could signal the onset of a corrective phase.

U.S. Economic Data Influence on USD/JPY Dynamics

The USD’s trajectory has been uneven, demonstrating resilience against the Japanese yen amid broader weakness. This dynamic is intricately linked to recent U.S. economic data releases, including higher-than-expected jobless claims and a dip in the ISM Services PMI, contrasting with the robust ISM Manufacturing PMI. The anticipation surrounding the U.S. jobs report and average hourly earnings index has also fueled speculation, particularly concerning potential Japanese government interventions in the foreign exchange markets.

Japanese Intervention Eyed as USD/JPY Flirts with 155

Market participants closely monitor the possibility of Japanese intervention, especially if the USD/JPY pair approaches the 155.00 level. According to Hiroshi Watanabe, a former Japanese top F.X. diplomat, intervention remains unlikely unless the pair exceeds this threshold. Nevertheless, the currency pair appears vulnerable below the 151.00 mark, with technical indicators suggesting potential support near 150.25.

USD/JPY: A ‘Buy on Dips’ Strategy Amid Rate Differentials

Given the interest rate differentials between the U.S. and Japan, the USD/JPY pair remains a focal point for investors. It shows up as a ‘buy on dips’ opportunity, with the 150.00 level as a pivotal short-term floor. The market keeps navigating through these economic indicators and potential policy responses. However, the currency pair’s future trajectory will remain under close watch. Thereby offering a litmus test for broader financial market sentiments.

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