Markets Analysis

USD/JPY Rises as Nvidia’s Sales Outlook Drives AI Boom【February 22, 2024】

February 22, 2024

Markets Analysis

Fundamental Analysis

  • Nvidia’s sales outlook exceeds expectations, Nasdaq rebounds
  • Stock price surge in AI boom supported by data
  • FRB suggests no rush to lower US interest rates, leading to dollar strength

USDJPY Technical Analysis

USDJPY rebounds at the conversion line of Ichimoku Kinko Hyo, rising to around 150.40 JPY. There is considerable buying interest below 150 JPY, stabilizing the downside. Additionally, there are currently no yen-buying catalysts, making the dollar prone to strength.

While there may be intervention concerns around 152 JPY, it’s expected that the dollar will lean towards strength today, given the robust US economy and the FRB’s indication of no rush for rate cuts. The RSI stands at 61, indicating a solid upward trend despite hovering around the 150 JPY level, which is not in the overbought territory but rather signifies a firm bullish trend.

[USDJPY/ D1]

Day Trading Strategy (1-Hour Chart)

Analyzing the 1-hour chart of USDJPY, the dollar is advancing following the FOMC minutes released earlier today, indicating the FRB’s cautious approach to rate cuts and Nvidia’s sales outlook surpassing expectations amidst the AI boom.

Considering a potential further uptick in the stock market today, it’s inclined towards dollar buying. Therefore, it’s preferred to trade USDJPY with a bullish bias. Specifically, buy on dips around 150.25 JPY, with a target exit around 150.65 JPY and a stop loss at 149.95 JPY.

Support and Resistance Lines

The following support and resistance lines should be considered:

150.70 JPY – Major resistance level
150.27 JPY – Monthly support level

[USDJPY/ H1]

Market Sentiment

USDJPY Sell: 68% Buy: 32%

Today’s important economic indicators

Economic indicators and eventsJapan time
Nikkei Services PMI9:30
Eurozone Consumer Price Index19:00
US Initial Jobless Claims22:30
ISM Non-Manufacturing PMI23:45
US Existing Home SalesMidnight
US Crude Oil Inventories1:00 (next day)

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

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