Aayush Jindal
Key Highlights
- USD/JPY started a fresh increase after a sharp drop to 145.50.
- It cleared a major bearish trend line with resistance at 147.50 on the 4-hour chart.
- The Fed’s interest rate cut sparked swing moves, but ultimately the bulls had the upper hand.
- EUR/USD and GBP/USD started a downside correction.
USD/JPY Technical Analysis
The US Dollar declined sharply against the Japanese Yen during the Fed rate decision. USD/JPY spiked to 145.50 before there was a sharp recovery.
Looking at the 4-hour chart, the pair climbed above the 146.50 and 147.00 resistance levels. More importantly, the pair cleared a major bearish trend line with resistance at 147.50. It opened the doors for more gains above the 50% Fib retracement level of the downward move from the 149.13 swing high to the 145.48 low.
The pair settled above the 147.50 level, the 100 simple moving average (red, 4-hour), and the 200 simple moving average (green, 4-hour).
On the upside, the pair could face resistance near the 148.25 level or the 76.4% Fib retracement level of the downward move from the 149.13 swing high to the 145.48 low. The first major hurdle for the bulls could be 148.50.
A close above 148.50 could set the pace for a steady recovery wave. In the stated case, the pair could rise toward 149.20, above which the bulls could aim for a move toward 148.65. Any more upsides could send the pair toward 150.00.
On the downside, immediate support is 147.50. The next key area of interest might be near the 147.20 zone. The main support could be 146.50. Any more losses might increase selling pressure and send USD/JPY toward 146.00.
Looking at EUR/USD, the pair failed to continue higher above 1.1920 and recently started a downside correction.
Upcoming Key Economic Events:
- BoJ Press Conference.
- ECB's Sleijpen speech.
- EcoFin Meeting.
- Eurogroup Meeting.
