The USDJPY currency pair, which was at 146.296, experienced a decline to its lowest level in several days due to the comments from Bank of Japan Governor Haruhiko Kuroda’s indicating a more aggressive stance.
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- USD/JPY drops to a multi-day low on Monday in reaction to BoJ Ueda’s hawkish remarks.
The pair currently trades last at 146.296.
The previous day high was 147.87 while the previous day low was 146.59. The daily 38.2% Fib levels comes at 147.38, expected to provide resistance. Similarly, the daily 61.8% fib level is at 147.08, expected to provide resistance.
The buying interest around the Japanese Yen (JPY) remains unabated through the Asian session on Monday and drags the USD/JPY pair to a multi-day low, around the 146.35 region in the last hour. The pair has now retreated over 150 pips from the highest level since November 2022, near the 147.85 zone touched on Friday and is pressured by a combination of factors.
The Japanese Yen (JPY) strengths against all Group-of-10 currencies in reaction to Bank of Japan Governor Kazuo Ueda’s hawkish remarks, signalling possible interest rate hikes. In an interview with Yomiuri newspaper published on Saturday, Ueda said that ending negative interest rates is among the options available if the BoJ becomes confident that prices and wages will keep going up sustainably. This, along with a modest US Dollar (USD) pullback from a six-month peak, contributes to the offered tone surrounding the USD/JPY pair.
Furthermore, the latest leg down over the past hour or so could also be attributed to some technical selling below the 200-hour Simple Moving Average (SMA) support. That said, growing acceptance that the Federal Reserve (Fed) will stick to its hawkish stance and keep interest rates higher for longer should limit any meaningful USD downfall. The bets were reaffirmed by The Wall Street Journal report, noting that some officials still prefer to err on the side of raising rates too much, reasoning that they can cut them later.
The outlook, meanwhile, remains supportive of elevated US Treasury bond yields and should act as a tailwind for the Greenback. This, along with the fact that Ueda reiterated the need to continue the patient monetary easing as the BoJ is some distance away from achieving its price stability target, supports prospects for the emergence of some dip-buying around the USD/JPY pair. This, in turn, warrants caution before placing aggressive bearish bets and positioning for deeper losses in the absence of any relevant macro data.
Traders might also prefer to move to the sidelines ahead of this week’s release of the latest US consumer inflation figures on Wednesday. This will be followed by the US Producer Price Index (PPI) and monthly Retail Sales data on Thursday. Apart from this, the European Central Bank (ECB)-infused volatility will drive the USD demand and provide some meaningful impetus to the USD/JPY pair. In the meantime, fears that Japanese authorities might intervene to prop up the domestic currency should keep a lid on spot prices.
Technical Levels: Supports and Resistances
USDJPY currently trading at 146.43 at the time of writing. Pair opened at 147.84 and is trading with a change of -0.95 % .
| Overview | Overview.1 | |
|---|---|---|
| 0 | Today last price | 146.43 |
| 1 | Today Daily Change | -1.41 |
| 2 | Today Daily Change % | -0.95 |
| 3 | Today daily open | 147.84 |
The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 146.27, 50 SMA 143.55, 100 SMA @ 141.17 and 200 SMA @ 137.09.
| Trends | Trends.1 | |
|---|---|---|
| 0 | Daily SMA20 | 146.27 |
| 1 | Daily SMA50 | 143.55 |
| 2 | Daily SMA100 | 141.17 |
| 3 | Daily SMA200 | 137.09 |
The previous day high was 147.87 while the previous day low was 146.59. The daily 38.2% Fib levels comes at 147.38, expected to provide resistance. Similarly, the daily 61.8% fib level is at 147.08, expected to provide resistance.
Note the levels of interest below:
- Pivot support is noted at 146.99, 146.15, 145.71
- Pivot resistance is noted at 148.28, 148.72, 149.56
| Levels | Levels.1 |
|---|---|
| Previous Daily High | 147.87 |
| Previous Daily Low | 146.59 |
| Previous Weekly High | 147.88 |
| Previous Weekly Low | 146.02 |
| Previous Monthly High | 147.38 |
| Previous Monthly Low | 141.51 |
| Daily Fibonacci 38.2% | 147.38 |
| Daily Fibonacci 61.8% | 147.08 |
| Daily Pivot Point S1 | 146.99 |
| Daily Pivot Point S2 | 146.15 |
| Daily Pivot Point S3 | 145.71 |
| Daily Pivot Point R1 | 148.28 |
| Daily Pivot Point R2 | 148.72 |
| Daily Pivot Point R3 | 149.56 |
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