#USDJPY @ 147.871 US dollar’s reversal from the 149.00 area found support at 147.50. (Pivot Orderbook analysis)

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• US dollar’s reversal from the 149.00 area found support at 147.50.
• The US dollar loses ground on hopes of Fed easing.
• The yen will remain on the defensive on BoJ’s dovishness.

The pair currently trades last at 147.871.

The previous day high was 149.71 while the previous day low was 145.51. The daily 38.2% Fib levels comes at 148.1, expected to provide resistance. Similarly, the daily 61.8% fib level is at 147.11, expected to provide support.

The greenback dropped sharply across the board on Tuesday and the USD/JPY retreated from levels right below 149.00 to session lows at 147.50, where the pair has found buyers to attempt to regain the 148.00 level.

The US dollar plunged in the early US session on Tuesday following downbeat US housing prices and consumer confidence readings. These figures and the disappointing S&P PMI index released on Monday have revived fears that the Federal Reserve might be damaging growth with its radical monetary tightening plan.

Investor’s hopes that the Fed might be open to slowing down its rate hike path over the next months have boosted risk appetite. US stock markets extended gains after a mixed opening, while Treasury yields retreated, weighing on the USD.

Today’s decline gives some respite to the Japanese authorities, which are suspected of having stepped in, two times, attempting to curb yen weakness.

Last week, an alleged intervention by the Bank of Japan and the Ministry of Finance pulled the part from levels close to 152.00 to 146.20 area. The dollar, however, managed to retake more than half of the ground lost over the next couple of days.

In the longer term, the Japanese yen remains weighed by the monetary policy differential, an aspect that might gain relevance over the coming days.

While the Bank of Japan is expected to maintain its ultra-expansive policy on Friday, keeping bond yields near zero, the Fed is widely expected to hike rates by 75 basis points over the next week. This is highly likely to negative pressure on the JPY.

Technical Levels: Supports and Resistances

USDJPY currently trading at 147.94 at the time of writing. Pair opened at 148.91 and is trading with a change of -0.65 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 146.55, 50 SMA 142.95, 100 SMA @ 139.15 and 200 SMA @ 130.52.

The previous day high was 149.71 while the previous day low was 145.51. The daily 38.2% Fib levels comes at 148.1, expected to provide resistance. Similarly, the daily 61.8% fib level is at 147.11, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 146.37, 143.84, 142.17
• Pivot resistance is noted at 150.58, 152.24, 154.78

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