USD/JPY Forecast: Imminent bullish breakout

Valeria Bednarik FXStreet

USD/JPY Current price: 109.54

The yield on the US 10-year Treasury note jumped to 1.69%, a fresh one-month high.
Higher-than-anticipated US inflation spurred demand for the American currency.
USD/JPY is trading near its May monthly high and has room to extend its advance.

The USD/JPY pair peaked at 109.63 this Wednesday as higher US inflation sent government bond yields to one-month highs. The yield on the 10-year Treasury note reached 1.69%, just below the critical 1.70% level that spurred substantial dollar gains back in March. The pair trades near the mentioned high, despite Wall Street plummeted, as higher US inflation readings lifted concerns about a sooner than expected tighter monetary policy in the country.

Japan published the preliminary estimate of the March Leading Economic Index, which improved to 103.2 from 98.7 previously. The Coincident Index came in at 93.1 from 89.9 in February. Early on Thursday, the country will report the March Current Account and the April Eco Watchers Survey.

USD/JPY short-term technical outlook

The USD/JPY pair is trading in the 109.50 price zone, consolidating gains. In the 4-hour chart, the pair has advanced above all of its moving averages, which anyway lack directional strength. Technical indicators lost directional strength after reaching overbought readings but lack clear directional strength. The pair topped at 109.69 this month, with a break above the level favoring a bullish continuation.

Support levels: 109.25 108.80 108.30

Resistance levels: 109.70 110.10 110.50

View Live Chart for the USD/JPY

Author

Valeria Bednarik

FXStreet

Valeria Bednarik was born and lives in Buenos Aires, Argentina. Her passion for math and numbers pushed her into studying economics in her younger years.

AUD/USD breaks 0.7000 as RBA inflation warning fuels two-week high

The Australian Dollar registers solid gains versus the Greenback, climbing above 0.7000 and hitting a two-week high of 0.7017 as broad US Dollar weakness pushes AUD/USD above 0.7000 amid a light economic docket in both Australia and the US.

USD/JPY flatlines near 158.50 as markets seek direction

USD/JPY steadies around 158.50 in the Asian trading hours on Tuesday. Traders prefer to wait on the sidelines ahead of Japan’s National Consumer Price Index inflation data later on Friday. Meanwhile, elevated US bond yields provide some support to the US Dollar against the Japanese Yen.

Gold just failed at $4,150. This is the next stop

Gold prices trade without a clear direction on Tuesday, hovering around the $4,170 region per troy ounce and still struggling to regain upside traction following Monday’s pullback. In the meantime, lower US Treasury yields and a marked pullback in the US Dollar come in tandem with the yellow metal’s price action.

Bitcoin resumes Nasdaq correlation as macro pressures threaten $82,500 support

Bitcoin's (BTC) correlation with the Nasdaq is rising again after last week's decline alongside tech stocks, even as macro pressures place the $82,500 support at risk. In a report on Tuesday, K33 Research highlighted that Bitcoin has resumed its correlation with the tech-heavy Nasdaq after last week's price movements.

SpaceX's earnings don't matter. What they unlock does

The Elon Musk-founded SpaceX reports third-quarter results after Tuesday's session. The figure that decides the next month for the stock isn't in them. On Thursday, the second full trading day after the release, up to 1.3 billion shares held by employees and early investors become eligible for sale.

The US Dollar fell. Gold didn't rally. That tells you everything

Gold (XAU/USD) is struggling to capitalize on a weaker US Dollar (USD), after repeatedly failing to establish itself above the $4,200 level. The precious metal remains confined to a relatively narrow trading range despite a combination of developments that would normally support higher prices.