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USD/JPY Extends Rally, Services PMI’s Next

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Aayush Jindal

Key Highlights

  • USD/JPY extended its increase above the 136.50 resistance.
  • A major bullish trend line is forming with support near 136.20 on the 4-hours chart.
  • Gold price might revisit the $1,845 and $1,850 resistance levels.
  • The US ISM Services PMI could decline from 55.2 to 54.5 in Feb 2023.

USD/JPY Technical Analysis

The US Dollar started a steady increase above the 135.00 resistance against the Japanese Yen. USD/JPY even climbed above 136.20 to move further into a positive zone.

Looking at the 4-hours chart, the pair settled above the 136.00 support level, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).

Finally, there was a spike above the 137.00 level. The pair is clearly trading in a strong uptrend. There is also a major bullish trend line forming with support near 136.20 on the same chart. On the upside, an immediate resistance is near the 137.20 level.

The next major resistance is near the 138.00 level. A clear move above the 138.00 resistance might start a steady increase towards the 140.00 zone.

On the downside, an immediate support is near the 136.20 level. The next major support is near the 135.50 level, below which there is a risk of a move towards the 134.20 level or the 100 simple moving average (red, 4-hours). Any more losses could open the doors for a drop towards 132.50.

Looking at gold price, there are some positive signs and the bulls might attempt a move towards the $1,845 resistance zone.

Economic Releases

  • Germany’s Services PMI for Feb 2023 - Forecast 51.3, versus 51.3 previous.
  • Euro Zone Services PMI for Feb 2023 – Forecast 53.0, versus 53.0 previous.
  • UK Services PMI for Feb 2023 – Forecast 53.3, versus 53.3 previous.
  • US Services PMI for Feb 2023 – Forecast 50.5, versus 50.5 previous.
  • US ISM Services PMI for Feb 2023 – Forecast 54.5, versus 55.2 previous.
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