USDJPY Bullish target to 152 post-Fed.

1 בנוב׳ 2023

The USD/JPY cross remains stable near the 151.00 level as the Federal Reserve (Fed) keeps interest rates between 5.25% and 5.5%, as widely expected by the markets. However, the lack of significant changes in the Fed's rate statement leaves investors uncertain about a possible rate hike in December to close out the year. The U.S. Dollar Index (DXY) is on a two-day upward trajectory, supported by elevated U.S. Treasury yields. Currently, the index is trading higher near 106.70 at the time of writing. Additionally, the market expects the upcoming monetary policy decision from the U.S. Federal Reserve, indicating that the central bank will maintain its current monetary policy in the Wednesday meeting. Investors will closely monitor the post-meeting communication of the Federal Open Market Committee (FOMC), eager to obtain insights that can help assess the potential path of interest rates. Data-driven considerations for December add an extra layer of dynamic anticipation to the market. Traders will also watch key indicators such as the U.S. ADP Employment Change and ISM Manufacturing PMI for October in the North American session. USD/JPY is trading around 151.20 during the Asian session on Wednesday, retracing from the annual highs reached after the Bank of Japan (BoJ) removed the 1% ceiling for the 10-year government bond yield on Tuesday. Following the adjustment of the yield curve control (YCC), BoJ Governor Kazuo Ueda has adopted a notably accommodative stance. He expressed concerns about inflation not definitively reaching the BoJ's long-term targets. Japan's Chief Cabinet Secretary, Hirokazu Matsuno, engaged in verbal intervention to support the yen. He emphasized the importance of currencies moving in a stable manner that reflects fundamentals and expressed disapproval of rapid foreign exchange (FX) fluctuations. While refraining from commenting on specific FX levels, Matsuno did not rule out the possibility of taking measures to address disorderly FX movements. Moreover, the unexpected decline in China's Caixin Manufacturing Purchasing Managers' Index (PMI) to 49.5 in October, down from September's expansion at 50.6, as reported in the latest Wednesday data, has added pressure on the Japanese Yen (JPY). On the daily chart, it's also possible to observe that the market is bouncing within an ascending channel since the end of August. Currently, it's at the 150.90 level, and from here, it could bounce to the 149.70 level, which corresponds to the 0.705 Fibonacci level before continuing the ascent towards 152 and beyond. Comment and leave a like to support our work. Greetings from Nicola, the CEO of Forex48 Trading Academy.

2 בנוב׳ 2023

הערה

The Yen is recovering after a sharp sell-off following the Bank of Japan's meeting. The USD/JPY exchange rate has returned to previous highs thanks to the accommodative interpretation of Federal Reserve Chairman Jerome Powell's statements at the post-Fed meeting press conference. Although there has been a temporary dip, the overall trend remains bullish. However, to confirm the bullish trend, it is necessary to surpass the 2022 high at 151.92. The Yen was assisted by a weaker Dollar following Powell's accommodative remarks on monetary policy. The dramatic sell-off after the Bank of Japan's meeting is now being recovered.