Markets Analysis

Markets wary of foreign exchange intervention, USDJPY hovering around 143 JPY【June 27, 2023】

June 27, 2023

Markets Analysis

Fundamental Analysis

  • U.S. Stock Indexes Fall; Selling of High-Tech Stocks, Including AI Stocks, Continues
  • Treasury Secretary Kanda commented that the current depreciation of the JPY is rapid and one-sided
  • USD/JPY weighed down in the latter half of JPY 143 and temporarily fell below JPY 143, rebounding but unable to exceed the highs
  • Limited impact of political unrest in Russia, little effect on oil prices

USDJPY Technical Analysis

The USDJPY was supported by the 24-moving average, a daily moving average, but fell below JPY 143 during the London timeframe due to the comments by the Japanese Finance Minister. Despite buying back in, the pair was unable to break above the high of JPY 143.80. Overall, we believe that the upward trend has paused on the 1-hour time frame, and we can expect a short-term downtrend next.

RSI

Analysis of the RSI shows a consistent downward trend after a high of 70. RSI can be thought of as the ratio of upward and downward movements within a certain period of time. Currently, it is at 52, so the forces of upsides and downsides are almost in tandem. If the RSI falls below 50, the market has strong downward momentum and may trigger further selling.

Projected Level of Currency Intervention

The last currency intervention was conducted at around JPY 145. This time, too, if it is to be implemented, it is expected to be near the previous exchange rate level. A sharp rise to around JPY 145.35 or 145.55 would greatly increase the likelihood of implementation, so caution should be exercised in avoiding excessive deep buying.

Support and Resistance Lines

The resistance line to be considered in the future is as follows

145.35 JPY – Currency intervention alert level
144.60 JPY – Today’s upper price reference level
142.90 JPY – Major support zone

[USDJPY / H1]

Market Sentiment

USDJPY Sell: 71% Buy: 29%

Today’s Important Economic Indicators

Economic Indicators and EventsJST (Japan Standard Time)
U.S. durable goods orders21:30
Canada Consumer Price Index21:30
U.S. May New Home Sales23:00

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

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