- USD/JPY is under renewed selling pressure and is affected by a combination of factors.
- The deterioration in market sentiment gives the yen some support.
- The currency fully recovered after the fall that followed the Bank of Japan’s decision.
The pair USD/JPY it extended the sharp pullback that began on Tuesday from the 131.55 zone, the weekly high, and fell to 127.73. From there he bounced and is trading at the 128.50/6 zone. It is still negative but far from the minimum.
The risk-off state prevailing in the equity markets benefits the Japanese Yen and puts some downward pressure on the USD/JPY pair. Investors remain concerned about headwinds stemming from the worst COVID-19 outbreak in China. This, along with the protracted war between Russia and Ukraine, has fueled concerns of a deeper global economic recession.
In addition, weaker US economic data released on Wednesday sparked recession fears and weighed on investor sentiment. Meanwhile, the risk averse current, along with bets on lower interest rate hikes by the Federal Reserve, drag Treasury yields lower. The yield on the two-year tranche dropped to its lowest since October. This keeps dollar bulls on the back foot and fails to support the USD/JPY pair.
However, the falls seem limited, at least for the moment, after the moderate decision of the bank of japan on Wednesday. In fact, the Japanese central bank kept interest rates ultra-low and left the yield control curve caps unchanged, defying expectations for more aggressive signals. Three this the yen had a crash, but in the following hours managed to fully recover.
Market participants now await the US economic calendar, with the Philadelphia Fed manufacturing index, the usual weekly initial jobless claims and housing market data. This, along with speeches from influential FOMC members and US bond yields, will be key for USD/JPY.
technical levels
USD/JPY
Overview | |
---|---|
Last price today | 128.4 |
Today Daily Variation | -0.47 |
today’s daily variation | -0.36 |
today’s daily opening | 128.87 |
Trends | |
---|---|
daily SMA20 | 131.48 |
daily SMA50 | 135.24 |
daily SMA100 | 140.32 |
daily SMA200 | 136.68 |
levels | |
---|---|
previous daily high | 131.58 |
previous daily low | 127.57 |
Previous Weekly High | 132.87 |
previous weekly low | 127.46 |
Previous Monthly High | 138.18 |
Previous monthly minimum | 130.57 |
Fibonacci daily 38.2 | 130.05 |
Fibonacci 61.8% daily | 129.1 |
Daily Pivot Point S1 | 127.1 |
Daily Pivot Point S2 | 125.33 |
Daily Pivot Point S3 | 123.08 |
Daily Pivot Point R1 | 131.11 |
Daily Pivot Point R2 | 133.35 |
Daily Pivot Point R3 | 135.12 |
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.