USD / JPY is approaching 115.00 following the reappointment of Powell as Fed chairman

• USD / JPY remained subdued in the evening session, but following the news from Powell, it gained 60 pips.
• On Friday, the Fed’s Waller and Clarida expressed interest in a faster reduction of bonds, in the event of accelerating inflation.
• The rise in US Treasury yields approached 1.60% and raised the USD / JPY pair.

The USD/JPY it rises during the American session, trading at five-year highs, up 0.59%, trading at 114.67 at the time of writing this report. Market sentiment is upbeat, fueled by US President Biden, who reappointed Powell as Fed chairman. Additionally, some Fed policy makers said they would like to increase the pace of the bond cut, concerned that the inflation could get out of your hands.

In the night session, the USD / JPY pair remained moderate at the 114.00-114.27 area. However, during the US session, the re-election of Fed Chairman Powell boosted investor confidence, boosting the major US stock indices in tandem with US Treasuries and the dollar.

As the American session progresses, the US dollar index, which measures the performance of the dollar against a basket of its peers, advances 0.43% to 96.45, clinging to the 96.40 level. In addition, the increase in US Treasury yields benefits the USD. 10-year yields rose as much as 5bp to 1,593%, boosting the dollar against the Japanese yen.

USD / JPY Price Forecast: Technical Outlook

On the daily chart, USD / JPY represents an upside bias. Daily Moving Averages (DMA) reside below the spot price, although approaching an interest level around the 114.70-115.00 zone, unsuccessfully broken three times. However, a daily break above the 115.00 figure would open the door to further gains. The first resistance would be in December 2016 oscillating at highs around 118.66.

On the other hand, the first support would be the maximum of November 19 at 114.53. A break below that level would expose 114.00, followed by the November 19 low at 113.58.