USD/JPY: Bias to sell rallies in USD/JPY – OCBC
|Markets continue to see a confluence of risk factors, including Trump’s tariff threats and dividend seasonality trends that may prove 'noisy' for USD/JPY, OCBC's FX analysts Frances Cheung and Christopher Wong note.
Macro drivers remain intact
"USD/JPY touched a high of 151.02 this morning but was brief as the pair reverted to trade lower. Last at 150.35 levels. Daily momentum is flat while rise in RSI moderated. Bias remains to sell rallies. Resistance at 150.50, 151.50 (38.2% fibo retracement of Sep low to Jan high). Support at 149.20 (50% fibo), 148.80 before 147 (61.8% fibo)."
"That said, macro drivers remain intact. Prospects of wage growth, broadening services inflation and upbeat economic activities in Japan continue to support the BoJ policy normalization while fading US exceptionalism validates our bias for the Fed cut cycle to continue."
"Fed-BoJ policy divergence should underpin broader direction of travel for USD/JPY to the downside. So, maintain bias to sell rallies in USDJ/PY should there be a bounce driven by tariff uncertainty or seasonality trends."
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.