Has Japanese Yen Weakened Enough? USD/JPY, EUR/JPY, GBP/JPY Price Action


US Dollar, Euro, British Pound Vs Japanese Yen – Price Action:

  • USD/JPY has turned again sharply from key resistance.
  • EUR/JPY and GBP/JPY have additionally run into a serious roadblock.
  • What is the outlook and the important thing ranges to look at within the yen crosses?

Recommended by Manish Jaradi

How to Trade USD/JPY

The Japanese yen has run into robust help in opposition to a few of its friends, elevating the prospect of some extra positive aspects within the quick time period.

The yen has appreciated after the Fed raised its benchmark fee by the broadly anticipated 25 foundation factors to the 5.00-5.25% vary. “We’re closer or may be even there,” Fed Chair Powell stated with regards to the terminal fee. While this hints at a pause within the climbing cycle, the Fed retained a hawkish bias, noting “in determining the extent to which additional policy firming may be appropriate”. Key focus can be on incoming information, notably jobs report and CPI information forward of the June assembly, and the extent to which credit score tightening has spilled over the broader economic system.

In phrases of financial coverage outlook, the Fed indicated a pause at its assembly yesterday is more likely to maintain a lid on USD and Treasury yields, until information suggests in any other case within the coming week. Meanwhile, the Bank of Japan final week saved the ultra-loose coverage settings unchanged. If danger sentiment stays in test because of the uncertainty with regard to the US debt ceiling and the banking sector, USD/JPY may transfer towards the decrease finish of the well-established vary.

US Treasury 2-year yield Daily Chart

Chart Created by Manish Jaradi Using TradingView

USD/JPY: Is this it?

On technical charts, USD/JPY has primarily been sideways in latest weeks, although the broader image stays bearish, as highlighted in latest updates. SeeApril 17,April 21, andApril 26updates. The pair has confronted stable resistance on the March excessive of 138.00, roughly coinciding with the 200-day shifting common.

USD/JPY 240-minute Chart


Chart Created Using TradingView

On the 240-minute charts, the pair is now testing fairly a powerful cushion on the 89-period shifting common, roughly across the decrease fringe of the Ichimoku cloud. Since early April, the pair hasn’t decisively fallen beneath the converged help. Any break beneath would verify that the short-term upward stress had light, paving the best way towards the April 27 low of 133.00. Furthermore, any break beneath 133.00 would expose draw back dangers towards the March low of 129.65.

EUR/JPY Weekly Chart


Chart Created by Manish Jaradi Using TradingView

EUR/JPY: Tough resistance holds for now

EUR/JPY is going through a stiff hurdle on the 2014 excessive of 149.75. A damaging momentum divergence on the each day charts (rising value related to declining Stochastics) suggests the cross may discover it robust to clear the hurdle no less than on this try. However, the upward stress is unlikely to fade whereas the cross stays above the late-April low of 146.25.

GBP/JPY Daily Chart


Chart Created by Manish Jaradi Using TradingView

GBP/JPY: Retreats from resistance

GBP/JPY has retreated from the October excessive of 172.10. Any break beneath instant help on the mid-April excessive of 167.95 would verify that the upward stress had eased, opening the best way towards the end-April low of 165.40.

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— Written by Manish Jaradi, Strategist for DailyFX.com

— Contact and comply with Jaradi on Twitter: @JaradiManish

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