Markets Analysis

USDJPY Forms a Narrow Range, Bank of Japan Ends Massive Easing for the First Time in 10 Years【March 19, 2024】

March 19, 2024

Markets Analysis

Fundamental Analysis

  • Anticipation of ending the “Quantitative and Qualitative Easing” that started in 2013
  • Expectations also conclude for negative interest rates and long-term interest rate operations
  • USDJPY has already priced in these developments, with focus on the Governor’s press conference for future outlook

USDJPY Technical Analysis

Analyzing the daily chart of USDJPY, the pair tends to lean towards a stronger USD, continuing its ascent along the upper limit of the Ichimoku cloud. Today, as the Bank of Japan’s monetary policy decision meeting is held, there is an anticipation of ending negative interest rates. Since this has already been priced into the market, the extent of hawkishness or dovishness in the BOJ Governor’s press conference is garnering attention.

It is unlikely that there will be a rapid increase in interest rates even if negative interest rates are abolished. This could, in turn, facilitate a move towards a stronger USD. Additionally, inflation in the United States has not reached the target of 2%, indicating a scenario where there are fewer rate cuts.

There is a possibility that USDJPY might rise again to around 150.50JPY under certain conditions.

[USDJPY/ D1]

Day Trading Strategy (1-Hour Chart)

Analyzing the 1-hour chart of USDJPY, the pair is experiencing a range-bound market in the short term, awaiting the announcement of key economic indicators today. The base line and conversion line are overlapping, solidifying around 149JPY in the first half.

Overall, a stronger USD tendency is anticipated. This week’s publication of the dot plot and various countries’ interest rate policies could significantly diverge in direction.

Regarding day trading policy, it is advised to refrain from trading in a market where predictions are difficult. Therefore, today’s trading stance is primarily to wait and see.

Support and Resistance Lines

The following are the support and resistance lines to consider:

149.35JPY – 1-hour chart range upper limit

149.03JPY – 1-hour chart range lower limit

[USDJPY/ H1]

Market Sentiment

USDJPY Selling: 67% Buying: 33%

Today’s important economic indicators

Economic indicators and eventsJapan time
Bank of Japan Monetary Policy Announcement11:30
Australian Policy Interest Rate Announcement12:30
Bank of Japan Press Conference15:30
Canadian Consumer Price Index21:30

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

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