USD/JPY rises towards 135.00 after US CPI boosted by US Treasury yields.

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  • US dollar gains momentum after US inflation figures.
  • US CPI rises in February in line with expectations.
  • USD/JPY rose 250 points from Monday’s low, with an eye on 135.00.

The pair USD/JPY it broke the range after the beginning of the American session and after the publication of the US CPI figures. The pair is trading above 134.70, at daily highs, as the US dollar strengthens. The dollar gains momentum, without surprises in the consumer inflation report

The February US Consumer Price Index rose 0.4% in February, as expected, while the annual rate slowed to 6% from 6.4%. Core CPI advanced 0.5%, slightly above the 0.4% market consensus.

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In the immediate aftermath of the report, the dollar was relatively quiet. However, the dollar gained momentum later as US yields moved higher. US Treasury yields are erasing most of Monday’s gains. The rebound in yields is supporting USD/JPY.

“Inflation has peaked, but that’s not news anymore. The point is that the price rise is not falling, it’s becoming rigid. Furthermore, the yearly inflation top remains in jeopardy if core CPI exceeds 0.3%,” explains Yohay Elam, an analyst at FXStreet. Just a week ago, the question on the Fed was whether it would raise rates 25 or 50 basis points. It is now unchanged or 25 bp. Based on the market response so far to the CPI, there is still a chance of a rise. On Wednesday the Producer Price Index will be published. Retail Sales figures will also be published.

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USD/JPY is erasing Monday’s losses and is approaching the 20-day moving average (135.40). Intraday outlook is bullish, although the overall picture offers mixed signals. If the bullish move extends above 135.60, it could gain more momentum. Conversely, a drop below 133.50 would uncover Monday’s three-week low of 132.26.

technical levels


Last price today 134.48
Today Change Daily 1.28
today’s daily variation 0.96
today’s daily opening 133.2
daily SMA20 135.3
daily SMA50 132.46
daily SMA100 135.83
daily SMA200 137.49
previous daily high 135.05
previous daily low 132.29
Previous Weekly High 137.91
previous weekly low 134.12
Previous Monthly High 136.92
Previous monthly minimum 128.08
Fibonacci daily 38.2 133.34
Fibonacci 61.8% daily 133.99
Daily Pivot Point S1 131.97
Daily Pivot Point S2 130.75
Daily Pivot Point S3 129.21
Daily Pivot Point R1 134.74
Daily Pivot Point R2 136.28
Daily Pivot Point R3 137.5

Source: Fx Street

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