USD/JPY faces critical next few weeks as it tests 150 handle
The USD/JPY has rebounded after testing a multi-week low near the 149.00 handle on Monday on the on the back of dovish comments from Fed’s Waller, who said he’s inclined to cut rates in December.
However, with the yen being the biggest performer last week, underscoring expectations about a potential rate hike from the Bank of Japan, just as the world’s other central banks are now on the easing path, there is a good chance the USD/JPY could resume lower.
At the time of writing, it was testing a key pivotal area of around 150.00 ahead of critical US economic releases this week. With a jam-packed calendar including the closely watched JOLTS Job Openings report (today), ISM Services PMI, and the monthly Non-Farm Payrolls report to come, traders are bracing for volatility. These data points are expected to influence the USD/JPY, especially with both the Fed and BoJ policy decisions looming in December.
Should the 149.00-149.10 support area give way, the USD/JPY could drop to the next potential support at 147.20, possibly reaching 144.53 thereafter. The bulls will be eyeing a close above the 151.30 resistance level to nullify the bearish bias. While it is trading around the 150.00 area, it is in no-man's land, with a slight bearish tilt.
By Fawad Razaqzada, market analyst with FOREX.com
However, with the yen being the biggest performer last week, underscoring expectations about a potential rate hike from the Bank of Japan, just as the world’s other central banks are now on the easing path, there is a good chance the USD/JPY could resume lower.
At the time of writing, it was testing a key pivotal area of around 150.00 ahead of critical US economic releases this week. With a jam-packed calendar including the closely watched JOLTS Job Openings report (today), ISM Services PMI, and the monthly Non-Farm Payrolls report to come, traders are bracing for volatility. These data points are expected to influence the USD/JPY, especially with both the Fed and BoJ policy decisions looming in December.
Should the 149.00-149.10 support area give way, the USD/JPY could drop to the next potential support at 147.20, possibly reaching 144.53 thereafter. The bulls will be eyeing a close above the 151.30 resistance level to nullify the bearish bias. While it is trading around the 150.00 area, it is in no-man's land, with a slight bearish tilt.
By Fawad Razaqzada, market analyst with FOREX.com
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