Fundamental Analysis

• Both the U.S. and China emphasize “significant progress” in talks
•  The FX market reacts with USD buying; USDJPY opens in the 146 JPY range

USDJPY Technical Analysis

Analyzing the daily chart of USDJPY: the pair opened the week around the 146 JPY level. The previously uncertain U.S.-China trade negotiations concluded with both parties describing the outcome as “significant progress,” fueling expectations for a de-escalation of tensions.

USDJPY is moving near its 52-day moving average, with the Ichimoku cloud overhead acting as a resistance zone. The 52-day MA previously served as resistance during the March rebound, suggesting it may again act as a strong ceiling. Chasing the highs should be avoided.

This development is likely positive for equity markets, potentially reinforcing an upward trend. Whether USDJPY can break above the Ichimoku cloud will be a key point moving forward.

Day trading strategy

The FX market is responding with broad USD buying. Due to the weekend gap up in USDJPY, caution is warranted regarding a possible gap-filling move in the near term. A buy entry may be considered once the gap is closed.

The RSI has reached 68, suggesting the need for caution regarding potential pullbacks. While USDJPY has set a new high, attention should be paid to whether the 10-day moving average will act as a support level.

A move toward 148.50 JPY is also worth watching.

Day Trading Plan
Buy on dip strategy:

• Buy Entry: 145.50 JPY
• Take Profit: 145.90 JPY
• Stop Loss: 145.35 JPY

Support/Resistance lines

Key support and resistance lines to consider:

• 145.90 JPY – 52-day moving average
• 145.88 JPY – 10-day moving average

Market Sentiment

USDJPY – Sell: 45% / Buy: 55%

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