Trump Signs Executive Order on Tariffs – Watch for Stock and Forex Market Volatility【February 3, 2025】

Fundamental Analysis

• The Trump administration has announced the implementation of tariffs on Canada, Mexico, and China.
• Each country is preparing countermeasures, signaling the start of a trade war.
• This development has significant implications for stock indices and forex markets, making future predictions difficult at this stage.

USDJPY Technical Analysis

An analysis of the USDJPY daily chart shows that the pair has rebounded at the 90-day moving average. Despite the U.S. government implementing new tariffs, the market has reacted with a stronger USD. However, USDJPY is currently trading below the 26-day moving average and has also fallen below the ascending channel.

The 153 JPY level has shown strong buying support, leading to speculation on whether the pair will re-enter the ascending channel. While the stochastic indicator suggests a downward trend, it is not conclusive. For now, as long as USDJPY remains above the 90-day moving average, buying on dips appears to be the preferred strategy.

Day trading strategy (1 hour)

On the 1-hour USDJPY chart, the price has broken above the 26-day and 90-day moving averages and is approaching the 200-day moving average. However, with the stochastic indicator reaching a high level, it may be advisable to wait before entering a buy position. Resistance is expected to be strong above 155.50 JPY.

The market reaction to the tariffs remains uncertain, but a negative sentiment appears to be prevailing. The Nikkei 225 Index has opened with a significant gap down, reflecting concerns among investors. However, given the ongoing USD appreciation, the preferred strategy is to look for buying opportunities in USDJPY.

Trade Setup:

• Entry: Buy near 155.00 JPY
• Take Profit: 155.90 JPY
• Stop Loss: 154.65 JPY

Support/Resistance lines

Key support and resistance lines to consider:

• 153.20 JPY – 90-day moving average

Market Sentiment

USDJPY: Sell: 58% / Buy: 42%

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.