USD/JPY Surges, U.S. Employment Data Far Exceeds Expectations【February 5, 2024】
Fundamental Analysis
U.S. employment data far exceeded expectations, causing the Dollar Index to surge.
Expectations for U.S. interest rate cuts have been pushed back, and the market remains optimistic even in a high interest rate environment.
High interest rates are expected to continue, with USD/JPY aiming for the late 148 JPY range.
USDJPY Technical Analysis
Analyzing the daily chart of USD/JPY, it surged to the mid-148 JPY range following the strong U.S. employment data results. The Dollar Index’s sharp rise indicates a continuing trend of dollar strength.
Given the U.S. economy’s robustness in a high interest rate environment, the dollar has become more attractive, suggesting an upward trend for USD/JPY. Specifically, surpassing the recent high of 148.80 JPY could trigger an uptrend according to Dow Theory. Breaking through 148.80 JPY could lead to a surge towards the 150 JPY range, incorporating stop losses.
For dollar straight currency pairs, including USD/JPY, the approach should be with a bias towards buying dollars.
Day Trading Strategy (1-Hour Chart)
Analyzing the 1-hour chart of USD/JPY, it has rebounded from the Ichimoku cloud’s conversion line, indicating a strong upward signal. Considering the continuing dollar strength trend, entering a buy position for USD/JPY is advisable.
Surpassing the high of 148.80 JPY seems only a matter of time, and doing so could rapidly drive the pair towards the 150 JPY range, taking stop losses into account. However, with the RSI reaching 70, a rapid decline could follow a sharp increase. Therefore, it’s advisable to avoid excessive chase buying.
The day trading policy is market buy orders. For long-term trades, aim to settle at 150.50 JPY, and for short-term trades, at 149.60 JPY. If it falls below 147.5 JPY, a strategy revision is necessary.
Support and Resistance Lines
Upcoming significant support and resistance lines:
148.80 JPY – Recent high
Market Sentiment
USDJPY Sell: 75% Buy: 25%
Today’s important economic indicators
Economic indicators and eventsJapan timeU.S. ISM Non-Manufacturing Employment IndexMidnightFOMC Member Comments4:00 AM
*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.
