Markets Analysis

USDJPY Falls, Powell Indicates Potential Rate Cuts Within the Year【March 7, 2024】

March 07, 2024

Markets Analysis

Fundamental Analysis

  • Trump’s nomination is certain after Super Tuesday, setting up a rematch with President Biden.
  • USDJPY has fallen to the early 149 JPY range, with Powell anticipating rate cuts within the year.
  • Gold hits a new high as dollar weakens on US rate cut expectations.

USDJPY Technical Analysis

Analyzing the daily chart of USDJPY, it has broken below the conversion line of the Ichimoku Kinko Hyo, indicating a pause in the strong uptrend, and has even reached the baseline, now moving in the early 149 JPY range.

This may be a trend reversal influenced by the US Federal Reserve Chair’s indication of potential rate cuts within the year. However, with the RSI at 51, it’s advisable to avoid rushing into sell entries and to wait a bit longer.


Day Trading Strategy (1-Hour Chart)

Analyzing the 1-hour chart of USDJPY, a steady downtrend is occurring, moving from the early 149 JPY range into the 148 JPY range. The RSI is at 33, showing a stable downtrend.

While quick sell entries are not recommended, the US rate cut outlook combined with potential interest rate hikes from Japan’s move away from negative interest rates could apply upward pressure on the yen. It might be worth considering selling on a rebound.

Plan for a short-term sell at 149.25 JPY, settle at 148.80 JPY, and stop at 148.50 JPY, focusing on how much the yen will rebound.

Support and Resistance Lines

Key support and resistance lines to consider are:

148.80 JPY: A major support line


Market Sentiment

USDJPY Sell: 56%, Buy: 44%

Today’s important economic indicators

Economic indicators and eventsJapan time
Bank of Japan Board Member Comments10:30
ECB Interest Rate Decision22:15
US Unemployment Claims22:30
ECB Press Conference22:45
Comments by Fed Chair PowellMidnight
Comments by ECB President LagardeMidnight

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

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