- Dollar recovery fails at 147.45 and keeps bears in control.
- Speculation about Fed cuts in March limits the dollar’s bullish attempts.
- Hopes for some normalization of the BOJ’s monetary policy support the Yen.
The Dollar’s recovery from Monday’s lows found resistance at 147.45, and the pair has been trading with a moderate bearish tone on Tuesday. The caution of investors awaiting key employment figures in the US has cushioned the reversal of the Japanese yen.
Hopes for a Fed rate cut weigh on the dollar
Growing speculation that the Fed has ended hikes and that the US central bank will begin cutting rates in March is weighing on the US dollar.
By contrast, the Bank of Japan is expected to abandon its ultra-loose monetary policy in the coming months. This, together with the risk-averse sentiment in the markets, is cushioning the losses of the Yen, a safe haven currency.
On the calendar, today’s US Services ISM and Jolt Openings will set the stage for Wednesday’s ADP and Friday’s Nonfarm Payrolls, the main event of the week.
From a technical point of view, the 4-hour chart shows the pair trading within a falling wedge, trending down from the mid-November highs. Price action remains well below the main SMAs and the RSI has turned lower below its midline, suggesting that further declines are ahead.
The next supports are 146.30 and 146.00. Resistances: 147.45 and 148.50, the 38.2% retracement of the fall from November to December.
Technical levels to monitor
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.
