USDJPY Continues to Rise as US Official Mentions Possibility of Rate Hike【May 29, 2024】
Daily Market Analysis
Expert analysis of today's market movements and trading opportunities
Daily Market Analysis
Expert analysis of today's market movements and trading opportunities
Fundamental Analysis
- US 10-Year Treasury Yield Rises, USDJPY Reaches 157 JPY
- The USDJPY remains on a gradual upward trend, potentially targeting 157.70 JPY
- The President of the Minneapolis Federal Reserve commented that the possibility of a rate hike cannot be completely ruled out
USDJPY technical analysis
Analyzing the USDJPY daily chart, USDJPY has surpassed its recent high of 157.19 JPY and is trading around 157.35 JPY. Yesterday, the sharp rise in the US 10-Year Treasury yield strengthened USD buying. Although Japan’s long-term interest rates have also exceeded 1.0%, their effect remains limited.
The President of the Minneapolis Federal Reserve stated that the possibility of a rate hike cannot be entirely dismissed. With inflation rates not meeting expectations, the prospect of a rate cut will take more time.
It is expected that USDJPY will rise towards the target of 157.70 JPY, near the +2σ line of the Bollinger Bands. The ADX is at 44.9, with +DI at 32, indicating a strengthening upward trend.
Day trading strategy (1 hour)
Analyzing the USDJPY 1-hour chart, USDJPY broke out at 157.00 JPY and surged to 157.35 JPY, likely due to stop-loss buybacks. In the short term, with month-end rebalancing, volatility might increase due to profit-taking sales.
The US Consumer Confidence Index exceeded expectations, leading to a surge in USD buying. It is expected that USDJPY will continue its gradual rise.
The day trading strategy is to buy on dips. The plan is to buy on dips around 157.15 JPY and take profits at 157.70 JPY, with a stop at 156.85 JPY.
Support/Resistance lines
The support and resistance lines to consider are as follows:
- 157.70 JPY – Daily resistance line
Market Sentiment
USDJPY – Sell: 75% | Buy: 25%
Featured Currency Pair of the Week (GBPCAD)
The GBP/CAD movement has slowed. Volatility is decreasing, indicating a search for direction. GBP/CAD tends to move after the London session begins. Yesterday, crude oil prices surged significantly, which is a bullish factor for the Canadian Dollar.
On the other hand, many traders expect high interest rates to continue for the Pound until July, supporting strong dip buying. As a result, the market is somewhat stagnant. If crude oil prices decline again, GBP/CAD might gain upward momentum.
Today’s important economic indicators
| Economic indicators and events | Japan time |
| FOMC Member Speech | 2:45 AM |
*Trading advice in this article is not provided by Milton Markets, but by Shu Fujiyasu Jr., a certified technical analyst.
