Markets Analysis

Fundamental Analysis

• USD/JPY Falls to Mid-149 JPY, Enters Adjustment Phase
• Focus on whether USD/JPY will break below Ichimoku Cloud’s base and conversion lines, and if RSI falls below 50
• U.S. stock indices take a breather, despite growing expectations of an end to rate hikes, but are in an overbought range

USDJPY Technical Analysis

Analyzing the daily chart of the USD/JPY. Movements below Ichimoku Cloud’s base and conversion lines are observed, with early November lows of 148.80 JPY and 148.50 JPY being key levels. RSI is on a gradual downward trend, with breaking below 50 being a crucial indicator for future direction.

If RSI rebounds at 50, there’s a possibility of an upward move. The proximity of the Ichimoku Cloud also suggests it could act as a lower support, making a rapid appreciation of the yen unlikely.

However, considering the sharp drop to 129 JPY in 2022, caution is needed with market movements. This week, with U.S. markets closed for Thanksgiving in the latter half, increased volatility is expected in the first half of the week.

Day Trading Strategy (1-Hour Chart)

Analyzing the 1-hour chart of the USD/JPY. Currently, the USD/JPY is showing a typical downward trend, having hit a low of 149.19 JPY before rising to 149.90 JPY.

This movement, observed amidst increasing probabilities of the end of the U.S. interest rate hike cycle, indicates instability in the market, as the Bank of Japan has yet to make a move. The daily chart suggests a tendency towards selling.

For day trading, a strategy of selling on rallies is recommended. Entry point at 150.15 JPY, target profit at 148.65 JPY, and a stop-loss line at 150.50 JPY.

Support and Resistance Lines

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

148.50 JPY – A major support line

Market Sentiment

USDJPY – Sell: 52%, Buy: 48%

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.