USDJPY Market Remains Unmoved, Volatility Decreases as Fiscal Year-End Approaches【March 27, 2024】
Fundamental Analysis
Finance Official Kanda comments that recent movements are speculative
Mentions taking all necessary measures, spreading caution about potential currency intervention
Despite narrowing Japan-US interest rate differentials, the backdrop of ongoing JPY depreciation
USDJPY Technical Analysis
Analyzing the daily chart of USDJPY using moving averages and ADX for technical analysis. Observing the 90-day and 28-day moving averages, there is a gentle but ascending trend.
The ADX (14) indicator has risen to 42, suggesting the emergence of a trend. However, both +DI and -DI are pointing downwards, indicating a strong trend without a clear direction, hence, it’s prudent to avoid rash entries.
Finance officials, including Minister Kanda, have been verbally indicating currency intervention, keeping USDJPY from rising above the 152JPY mark. With the seasonal factor of the fiscal year-end, it might be wise to wait and see.
Day Trading Strategy (1-Hour Chart)
The trading range for USDJPY has narrowed significantly. After last week’s major event, it has been moving within a range of 151.00JPY to 151.50JPY, with the range gradually narrowing. Typically, such narrowing precedes a significant breakout. When the range narrows, it’s thought to be accumulating energy, preparing for the breakout.
If it breaks out above the 152JPY level, it could trigger a rapid surge by hitting stop losses. However, if currency intervention occurs, it could lead to a several hundred pips drop. Being sensitive to movements towards JPY depreciation, careful entry consideration is advised.
If buying, it is crucial to set a stop loss to limit the position. “Resting is also a part of trading,” hence it might be good to wait and watch.
Support and Resistance Lines
Key support and resistance lines to consider are as follows:
151.95JPY – The past highest value in the 151JPY range
151.00JPY – A round number
Market Sentiment
USDJPY Sell: 74% Buy: 26%
Today’s important economic indicators
Economic indicators and eventsJapan timeUS Crude Oil Inventories23:30
*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.
