USD/JPY Moves Around Early 148 JPY, Late 148 JPY Proves Heavy for Upside【January 22, 2024】

Fundamental Analysis

• NASDAQ in the U.S. updates its highest value, with expectations of rate cuts within the year leading to a rise in stocks.
• U.S. consumer survey shows increase in consumer mindset, but inflation expectations decrease.
• Expectations of U.S. rate cuts in 2024 rise, possibly pausing the strengthening of the dollar.

USDJPY Technical Analysis

Analyzing the daily chart of USD/JPY. It is forming a narrow range market in the early 148 JPY area, continuing days without a clear direction. This week, the Bank of Japan’s monetary policy meeting is scheduled, and the market is increasingly expecting future rate hikes. Focus is on how the BOJ Governor is thinking.
Although it surpassed the 147.40 JPY Fibonacci 61.8% mark, it lost momentum and slowed down. If the BOJ Governor’s press conference evades or completely dismisses the timing of rate hikes, it seems likely to lean towards a weaker yen.

Day Trading Strategy (1-Hour Chart)

Analyzing the 1-hour chart of USD/JPY. It is below the 24-moving average line, with the RSI value around 50. The high value of RSI is declining, suggesting increased downward pressure. Although it is still a range market, if the RSI value drops below 50, selling pressure may temporarily increase, leading to a drop to the early 147 JPY.
Specifically, around the 147.40 JPY corresponding to the daily Fibonacci 61.8%. In market sentiment, sell positions are accumulating, and if it reaches the early 147 JPY, it might rise sharply, triggering stop losses.
As a day trading approach, one would want to buy on dips after drawing in. Buy entry at 147.45 JPY, settle at 148 JPY, and stop at 147.25 JPY.

Support and Resistance Lines

Upcoming significant support and resistance lines:

148.20 JPY – Monthly resistance line

Market Sentiment

USDJPY Sell: 81%, Buy: 19%

Today’s Important Economic Indicators

*Trading advice in this article is not provided by Milton Markets, but by Shu Fujiyasu Jr., a certified technical analyst.