Markets Analysis

Fundamental Analysis

• U.S. stock indexes rise, U.S. GDP sharply revised up 2.0% y/y in Q1
• U.S. unemployment insurance claims fell sharply, suggesting that the U.S. economy is resilient despite concerns about interest rate hikes and recession
• USDJPY is at new highs since the beginning of the year, rising to around 144.90 JPY.
• A series of comments on yen depreciation, caution is advised against the risk of foreign exchange intervention

USDJPY Technical Analysis

The USDJPY surged as the New York crowd entered the market. It reached 144.90 JPY, its highest level since the beginning of the year, and 145 JPY is in sight. Analysis of the daily chart shows a strong upward trend, with seven consecutive days of gains. The background is probably the awareness of the interest rate gap between Japan and the U.S. and the strong dollar buying.

Confirmation of the dollar index shows that the trend of dollar strength is likely to continue for some time. USDJPY and other straight dollar currency pairs are trending in the direction of dollar buying.

Day Trade Strategy (Hourly)

Today’s day trading policy is to pull back enough to sell back or wait and see.

Analysis of the 1-hour chart shows that the price continues to rise, supported by the 24 moving averages (daily moving averages), but the upward momentum is weakening somewhat. A check of the RSI confirms that the RSI value is gradually declining.

With the daily RSI at 69.7, we may assume that the risk of a selloff is increasing. In any case, we would avoid a deep run in the buy direction.

Support and Resistance Lines

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

145.35 JPY – Major resistance line
144.90 JPY – Major resistance line
144.60 JPY – Pivot point

Market Sentiment

USDJPY　Sell: 70% Buy: 30%

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.