USD/JPY Nearing 150JPY, Divergence Occurring【October 25, 2023】
Fundamental Analysis
Strong U.S. economic indicators, leading to dominance of USD buying
Reduced demand for safe assets due to easing Middle East tensions
Divergence observed in the daily USD/JPY chart with MACD
USDJPY Technical Analysis
Analyzing the daily chart of the USD/JPY pair, currently, the market is clinging to a high around 150JPY, continuing to move within a narrow range. While the positive U.S. economic data has strengthened the USD buying sentiment, news regarding the Bank of Japan caused a temporary drop to 149.30JPY, which quickly recovered.
From a technical perspective, the Ichimoku Kinko Hyo’s conversion line is acting as a support, with 150JPY becoming a resistance level. Currently, no clear factors for a decline are visible, but the market seems to be stuck. However, a divergence is spotted in the daily MACD, indicating that one should be cautious about potential sharp declines.
Day Trading Strategy (Hourly)
Analyzing the daily chart for USD/JPY, the 1-hour chart reveals a range market formed between 149.65JPY to 149.95JPY, making trading challenging. The longer this range continues, the more significant the market movement could be during a breakout.
A temporary decline is expected, but levels around 149.53JPY and 149.15JPY are seen as good buying opportunities on dips. Positions should be squared if the price drops below 148.70JPY, and profit-taking can be considered around 149.95JPY.
Support and Resistance Lines
The resistance line to be considered in the future is as follows
150.00JPY – Major price point149.65JPY – Lower limit of the range market
Market Sentiment
USDJPY Sell: 74% Buy: 26%
Today’s Important Economic Indicators
Economic Indicators and EventsJST (Japan Standard Time)Australian Consumer Price Index (Expected Year-on-Year 5.3%)9:30U.S. Building Permits21:00New U.S. Home Sales23:00Canada Policy Rate23:00Speech by FRB Chairman Powell5:35 (following day)
*Trading advice in this article is not provided by Milton Markets, but by Shu Fujiyasu Jr., a certified technical analyst.
Risk Disclaimer
This analysis is for educational purposes only and does not constitute investment advice. Trading forex and CFDs involves significant risk and may not be suitable for all investors. Past performance is not indicative of future results.
This analysis is for educational purposes only and does not constitute investment advice. Trading forex and CFDs involves significant risk and may not be suitable for all investors. Past performance is not indicative of future results.
