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USD/JPY Gains Bullish Momentum, Dollar Extends Increase

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Aayush Jindal

Key Highlights

  • USD/JPY climbed higher above the 133.50 resistance zone.
  • A major bullish trend line is forming with support near 133.30 on the 4-hours chart.
  • EUR/USD extended losses and traded below the 1.0700 level.
  • Bitcoin price outperformed before it faced sellers near $25,000.

USD/JPY Technical Analysis

The US Dollar started a steady increase from the 129.80 zone against the Japanese Yen. USD/JPY climbed higher above the 131.20 and 132.00 resistance levels.

Looking at the 4-hours chart, the pair even gained pace above the 133.00 level, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).

The upward move was such that the pair traded to a new monthly high above 134.00. The next major resistance is near the 134.80 level. A clear move above the 134.80 resistance might start a steady increase towards the 135.50 resistance zone.

Any more gains could open the doors for a move towards the 136.20 level, above which the bulls may perhaps aim a move towards the 138.00 resistance.

On the downside, there is a decent support forming near the 133.30 level. There is also a major bullish trend line forming with support near 133.30 on the 4-hours chart.

The next major support is near the 132.60 level, below which there is a risk of a move towards the 100 simple moving average (red, 4-hours) at 130.80 in the coming days.

Looking at EUR/USD, the pair remained in a bearish zone and there was a clear move below the 1.0700 support zone.

Economic Releases

  • UK Retail Sales for Jan 2023 (YoY) - Forecast -5.5%, versus -5.8% previous.
  • UK Retail Sales for Jan 2023 (MoM) - Forecast -0.3%, versus -1.0% previous.
  • US Import Price Index for Jan 2023 (MoM) – Forecast -0.2%, versus +0.4% previous.
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