USDJPY | Perspective for the new week | Follow-up

Updated

In Japan, the Bank of Japan's Governor Kazuo Ueda highlighted that underlying inflation remains slightly below the 2% target during a Federal Reserve research symposium. This observation reaffirms the central bank's commitment to maintaining the current monetary policy approach. Despite core consumer inflation in Japan hitting 3.1% in July, companies passing on higher costs have sustained inflation above the 2% target for the 16th consecutive month.

Meanwhile, in the U.S., Federal Reserve Chair Jerome Powell's recent speech at the Jackson Hole symposium solidified the Fed's intention to uphold a 'higher for longer' outlook on interest rates and bond yields. This stance is a boon for dollar enthusiasts, especially considering the contrasting economic scenarios. The U.S. economy is exhibiting robust performance, with the latest Atlanta Fed tracking estimate indicating a near-6% annualized growth rate.

The widening short-dated yield spreads, which often influence exchange rates, favor the dollar over the Yen in recent weeks. This shift enhances the potential for the dollar to ascend into a higher trading range relative to the Yen.

As we navigate the upcoming week, it's crucial to consider these significant market drivers.

USDJPY Technical Analysis:
In this video, we conduct an in-depth technical analysis of the USDJPY chart, carefully examining the current market structure which is evidently bullish. Our primary focus is still within the key zone of 146.500, which will serve as our center of focus ahead of the upcoming week. As price action remains within this zone, it becomes an area of interest that has led to choppy consolidation before a clear direction emerges. The market's reaction around this area at the beginning of the new week will heavily influence the trajectory of price action in the days to come.

Join me on this journey as we explore potential trading opportunities using trendlines, key levels, and chart patterns. Be sure to stay connected to my channel, follow my updates, and actively engage in the comment section as we navigate the dynamic USDJPY market together.

Wishing you the best of luck as you chart your course in the USDJPY market this week.
#USDJPY #technicalanalysis #tradingopportunities #inflation #monetarypolicy #Fed #interestrates #economicanalysis #Forextrading

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Note

At the commencement of the new week, trading activities hover around the week's key level at 146.500 and are confined within a range that indicates the prevailing uncertainty. We shall exercise patience and wait for signals in the form of a breakout or breakdown of the range. It's crucial to bear in mind that today holds significance as we anticipate the release of labor data from the Japanese economy, notably the unemployment rate, and the anticipation of this event could potentially influence market dynamics.

Good Morning

Note

In the face of disappointing Japanese unemployment rate data, which came in at 2.7%—higher than anticipated—the US dollar has yet to seize the opportunity to break the resistance line during the Asian session. Despite this, trading activities have been confined within the 146.620 to 146.280 range since the week's inception, highlighting a prevailing uncertainty in the market. It's noteworthy, however, that the price action's inability to break out the resistance line within this range raises questions, especially in conjunction with the breakdown of the ascending trendline. This confluence hints at the emergence of sellers, potentially intensifying the prospect of a breakdown below the support line at the 146.300 region to incite a possible sell-off.

Good Morning

Trade active

UPDATE:
After securing a profit of more than 35 pips, price action has successfully breached the resistance line at 146.620. Safeguard your positions while we remain vigilant for new key levels that could contribute to a potential uptrend scenario.

Trade closed manually

Buy position is closed with a modest profit as selling pressure resumes. Is this a retracement move or an outright sell-off? Well, the structure will tell! Let's remain patient and see how the market reacts to the range we identified at the beginning of the week for our next course of action. Buying pressure will welcome an uptrend continuation while a breakdown followed by selling pressure will welcome selling opportunities. I will keep you posted.

Trade active

UPDATE

Secure sell position

Trade closed manually

The selling position was exited, securing a modest profit, as renewed buying pressure emerged precisely at the point where the ascending trendline, identified on the higher time frame, was tested. This occurrence suggests the potential of the uptrend continuation. At this juncture, we will remain patient to observe the market participants' response within the range of 146.280 and 146.500. Our focus will be on identifying patterns that align with a continuation of the uptrend. Furthermore, we are keeping an eye on the ADP employment change and the Gross Domestic Product figures from the US economic calendar today, as they could offer additional insights and guidance.

Good Morning

Trade active

So, as highlighted in our earlier live session this morning, it's prudent to secure the sell position at this juncture, considering the possibility of a formation of a "higher low."

Trade active

Initiate a cautious sell stance as the price movement encounters resistance within the 145.800 zone. The emergence of a breakdown/retest of this zone could potentially unlock additional selling opportunities.

Alternatively, if the prevailing buying pressure manages to endure within this zone, a breakout/retest of both the descending trendline and the 146.050 level could present favorable buying prospects.

Adding to the complexity of today's trading landscape, it's essential to note that this marks the final trading day of the month—a period traditionally linked to profit-taking activities. Furthermore, another impactful economic factor today is the US Core Personal Consumption Expenditures - Price Index, poised to provide vital insights.

Good Morning

Trade active

UPDATE

Buying pressure persists as 145.800 remains a barrier for sellers as discussed during our live session this morning

Trade closed: stop reached

Unfortunately, stop-loss has been triggered on the previous buy position. Kindly remain patient for fresh signals and confirmation, as a sense of indecision continues to prevail within this market.

Note

After being taken out of the buy position in a loss yesterday, the trading activities has remain range-bound, with price action confined within the narrow range of 145.600 to 145.360. This range underscores the prevailing indecision in the market, particularly in anticipation of today's pivotal release of the NFP data. This economic report is expected to provide deeper insights, prompting traders to reevaluate their expectations regarding the potential for a year-end interest-rate hike by the US Federal Reserve. Therefore, we must exercise patience, awaiting a clear signal in the form of a range breakout to identify viable trading opportunities. It's essential to emphasize the need for confirmations before entering positions, as we find ourselves at a critical juncture in the market.

Happy new month!

Trade active

Sell position triggered at the breakdown of the support line of the range at the 145.360 level; secure position. The US NFP data came in beyond expectation but levels with the previous month at 187K; market reaction is bearish for the Greenback as we look out for more selling opportunities should retest of structure happens.

Trade active

UPDATE

darcsherry

Trade smart. Trade consciously

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USDJPY | Perspective for the new week | Follow-up

by darcsherry

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