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USD/JPY Extends Rally But Can Bulls Push It To 150?

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Aayush Jindal

Key Highlights

  • USD/JPY started a strong increase above the 145.00 resistance.
  • A key bullish trend line is forming with support at 146.90 on the 4-hour chart.
  • EUR/USD declined further and traded below the 1.0880 support.
  • Gold prices trimmed gains and revisited the $2,000 support zone.

USD/JPY Technical Analysis

The US Dollar started a fresh increase from the 142.50 zone against the Japanese Yen. USD/JPY broke many hurdles near 145.00 to enter a positive zone.

Looking at the 4-hour chart, the pair settled above the 146.50 level, the 100 simple moving average (red, 4 hours), and the 200 simple moving average (green, 4 hours). The bulls even pushed it above the 148.00 level.

It is now consolidating gains, with immediate resistance near the 148.50 level. The next key resistance is near the 149.20 zone. A close above the 149.20 zone could open the doors for more upsides. The next stop for the bulls might be 150.00.

If there is a downside correction, the pair might find support near the 147.00 level. There is also a key bullish trend line forming with support at 146.90 on the same chart.

The next major support sits near the 50% Fib retracement level of the upward move from the 144.35 swing low to the 148.52 high at 146.45. A downside break below the 146.45 zone could spark a sustained decline.

The next major support is 145.40 or the 76.4% Fib retracement level of the upward move from the 144.35 swing low to the 148.52 high, below which the pair might decline and test the 100 simple moving average (red, 4 hours) at 144.40.

Looking at EUR/USD, the pair struggled to start a steady increase and extended its decline below the 1.0880 support zone.

Economic Releases

  • UK Retail Sales for Dec 2023 (YoY) - Forecast +1.1%, versus +0.1% previous.
  • UK Retail Sales for Dec 2023 (MoM) - Forecast -0.5%, versus +1.3% previous.
  • Michigan Consumer Sentiment Index for Jan 2024 (Prelim) – Forecast 70.0, versus 69.7 previous.
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