Markets Analysis

USD/JPY Nearing 150JPY, Divergence Occurring【October 25, 2023】

October 25, 2023

Markets Analysis

Fundamental Analysis

  • Strong U.S. economic indicators, leading to dominance of USD buying
  • Reduced demand for safe assets due to easing Middle East tensions
  • Divergence observed in the daily USD/JPY chart with MACD

USDJPY Technical Analysis

Analyzing the daily chart of the USD/JPY pair, currently, the market is clinging to a high around 150JPY, continuing to move within a narrow range. While the positive U.S. economic data has strengthened the USD buying sentiment, news regarding the Bank of Japan caused a temporary drop to 149.30JPY, which quickly recovered.

From a technical perspective, the Ichimoku Kinko Hyo’s conversion line is acting as a support, with 150JPY becoming a resistance level. Currently, no clear factors for a decline are visible, but the market seems to be stuck. However, a divergence is spotted in the daily MACD, indicating that one should be cautious about potential sharp declines.


Day Trading Strategy (Hourly)

Analyzing the daily chart for USD/JPY, the 1-hour chart reveals a range market formed between 149.65JPY to 149.95JPY, making trading challenging. The longer this range continues, the more significant the market movement could be during a breakout.

A temporary decline is expected, but levels around 149.53JPY and 149.15JPY are seen as good buying opportunities on dips. Positions should be squared if the price drops below 148.70JPY, and profit-taking can be considered around 149.95JPY.

Support and Resistance Lines

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

150.00JPY – Major price point
149.65JPY – Lower limit of the range market


Market Sentiment

USDJPY Sell: 74% Buy: 26%

Today’s Important Economic Indicators

Economic Indicators and EventsJST (Japan Standard Time)
Australian Consumer Price Index (Expected Year-on-Year 5.3%)9:30
U.S. Building Permits21:00
New U.S. Home Sales23:00
Canada Policy Rate23:00
Speech by FRB Chairman Powell5:35 (following day)

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