USDJPY Declines as Yen Buying Increases Amid Low Liquidity【November 29, 2024】

Fundamental Analysis

• Japan’s unemployment rate rises, leading to slight yen appreciation.
• The forex market remains mostly static due to the Thanksgiving holiday.

USDJPY Technical Analysis

Analyzing the daily chart of USDJPY reveals a strong downward trend, with the pair currently trading around 151.15JPY. The rise in Japan’s unemployment rate and the low liquidity environment appear to have intensified yen buying.

The price is falling along the -2σ line of the Bollinger Bands, suggesting the possibility of testing a break below 150JPY in moments of intensified yen buying. Observing the ADX, the gradual rise of the -DI indicates the strengthening of the downward trend.

If the recent low of 150.45JPY is breached, risk management strategies should account for a potential break below 150JPY.

Day trading strategy (1 hour)

Analyzing the 1-hour chart of USDJPY, the pair has broken below 151JPY, with the downtrend intensifying. Given the low liquidity, continued USD selling and yen buying are observed. Traders should exercise caution as the market is prone to high volatility.

While it is challenging to establish a day trading strategy, a potential rebound could be targeted if the price breaks below 150JPY. A contrarian trade aiming for a rebound near 149.50JPY, corresponding to the -3σ line of the Bollinger Bands, may be considered. However, given the challenging market conditions, it might be prudent to refrain from trading.

Support/Resistance lines

Key support and resistance lines to consider:

• 150.45JPY: Recent low

Market Sentiment

USDJPY: Sell: 42% / Buy: 58%

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.