USD/JPY Nearing 150JPY, Divergence Occurring【October 25, 2023】
October 25, 2023
- 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
USDJPY Sell: 74% Buy: 26%
Today’s Important Economic Indicators
|Economic Indicators and Events||JST (Japan Standard Time)|
|Australian Consumer Price Index (Expected Year-on-Year 5.3%)||9:30|
|U.S. Building Permits||21:00|
|New U.S. Home Sales||23:00|
|Canada Policy Rate||23:00|
|Speech by FRB Chairman Powell||5:35 (following day)|
*Trading advice in this article is not provided by Milton Markets, but by Shu Fujiyasu Jr., a certified technical analyst.