USD/JPY: the yen is rapidly losing ground
Current trend
The US dollar continues to develop a confident "bullish" trend in USD/JPY in Asian trading, renewing record highs since February 2016. Confident support for the US currency is provided by the prospects for further tightening of the US Federal Reserve's monetary policy.
The US regulator Chairman Jerome Powell made a frankly "hawkish" speech on Tuesday, noting that the Fed could raise rates by 50 basis points at once if the economic situation so requires. First of all, the regulator will assess the growth rate of inflation, which continues to accelerate as commodity prices rise and the world economy slows down due to events around Ukraine. Also, the Fed has not yet begun the procedure for reducing its own balance sheet, which, according to current estimates, is almost 9 trillion dollars.
Given such rhetoric by the US Federal Reserve, the yen has little chance of rising as a "safe" asset. The Japanese currency could be supported by the prospects of a gradual abandonment of the dollar as a reserve currency, but it's still a bit premature to talk about this. There are no prerequisites that the Bank of Japan will be able to move to tightening monetary policy in the near future. As before, the Governor of the regulator Haruhiko Kuroda is forced to deal with low inflation rather than with its rapid growth. At the same time, the latest published statistics indicate that prices are gradually accelerating in Japan as well. In addition, Japanese Finance Minister Shunichi Suzuki acknowledged that the depreciation of the yen is both positive and negative for the economy, but the stability of the currency is critical. Japan imports about 80% of its oil consumption, which continues to put pressure on the national currency in light of the increase in prices for "black gold". At the same time, a weaker yen makes Japanese exports more attractive.
Support and resistance
Bollinger Bands on the daily chart show a steady increase. The price range is expanding, but it fails to catch the development of "bullish" activity. MACD grows, preserving a stable buy signal (located above the signal line). Stochastic, having reached its highs, reversed into the horizontal plane, indicating strongly overbought USD in the ultra-short term.
Resistance levels: 121.40, 122.00, 122.50.
Support levels: 120.50, 120.00, 119.50, 119.00.
The US dollar continues to develop a confident "bullish" trend in USD/JPY in Asian trading, renewing record highs since February 2016. Confident support for the US currency is provided by the prospects for further tightening of the US Federal Reserve's monetary policy.
The US regulator Chairman Jerome Powell made a frankly "hawkish" speech on Tuesday, noting that the Fed could raise rates by 50 basis points at once if the economic situation so requires. First of all, the regulator will assess the growth rate of inflation, which continues to accelerate as commodity prices rise and the world economy slows down due to events around Ukraine. Also, the Fed has not yet begun the procedure for reducing its own balance sheet, which, according to current estimates, is almost 9 trillion dollars.
Given such rhetoric by the US Federal Reserve, the yen has little chance of rising as a "safe" asset. The Japanese currency could be supported by the prospects of a gradual abandonment of the dollar as a reserve currency, but it's still a bit premature to talk about this. There are no prerequisites that the Bank of Japan will be able to move to tightening monetary policy in the near future. As before, the Governor of the regulator Haruhiko Kuroda is forced to deal with low inflation rather than with its rapid growth. At the same time, the latest published statistics indicate that prices are gradually accelerating in Japan as well. In addition, Japanese Finance Minister Shunichi Suzuki acknowledged that the depreciation of the yen is both positive and negative for the economy, but the stability of the currency is critical. Japan imports about 80% of its oil consumption, which continues to put pressure on the national currency in light of the increase in prices for "black gold". At the same time, a weaker yen makes Japanese exports more attractive.
Support and resistance
Bollinger Bands on the daily chart show a steady increase. The price range is expanding, but it fails to catch the development of "bullish" activity. MACD grows, preserving a stable buy signal (located above the signal line). Stochastic, having reached its highs, reversed into the horizontal plane, indicating strongly overbought USD in the ultra-short term.
Resistance levels: 121.40, 122.00, 122.50.
Support levels: 120.50, 120.00, 119.50, 119.00.
כתב ויתור
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