USD/JPY climbs to fresh 2023-high above 136.00

USD/JPY gathered bullish momentum and climbed above 136.00 on Friday.
The data from the US showed that PCE inflation rose at a stronger pace than expected in January.
USD/JPY remains on track to post its highest weekly close since early December.

Eren Sengezer FXStreet

After having spent the European trading hours near 135.00, USD/JPY gathered bullish momentum in the early American session on Friday and reached its highest level since December 20 at 136.46. As of writing, the pair was trading at 136.30, where it was up 1.2% on a daily basis.

PCE inflation data fuels USD rally

Earlier in the day, incoming Bank of Japan Governor Kazuo Ueda said that a weak Japanese Yen would support exports, inbound tourism and some service sectors. Ueda added that they would need to normalize the monetary policy if inflation makes headway toward 2%. Since the data from Japan revealed that the National Core CPI edged higher to 4.2% on a yearly basis in January from 4% in December, these comments failed to help the Yen gather strength.

In the second half of the day, the US Bureau of Economic Analysis reported that the annual Personal Consumption Expenditures (PCE) Price Index rose to 5.4% in January from 5.3% in December (revised from 5%). Additionally, the Core PCE Price Index, the Fed's preferred gauge of inflation, rose 0.6% on a monthly basis and lifted the annual rate to 4.7% from 4.6%.

Reflecting the positive impact of hot inflation data on the US Dollar, the US Dollar Index advanced above 105.00 for the first time since early January.

Meanwhile, the benchmark 10-year US Treasury bond yield climbed to 3.95% following Thursday's slide and pus additional weight on USD/JPY's shoulders.

Technical levels to watch for

USD/JPY

Overview
Today last price	136.22
Today Daily Change	1.58
Today Daily Change %	1.17
Today daily open	134.64

Trends
Daily SMA20	132.18
Daily SMA50	131.8
Daily SMA100	137.25
Daily SMA200	137.04

Levels
Previous Daily High	135.36
Previous Daily Low	134.49
Previous Weekly High	135.11
Previous Weekly Low	131.27
Previous Monthly High	134.78
Previous Monthly Low	127.22
Daily Fibonacci 38.2%	134.82
Daily Fibonacci 61.8%	135.03
Daily Pivot Point S1	134.3
Daily Pivot Point S2	133.95
Daily Pivot Point S3	133.42
Daily Pivot Point R1	135.17
Daily Pivot Point R2	135.71
Daily Pivot Point R3	136.05

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

GBP/USD clings to 1.3500 amid marginal losses

GBP/USD alternates gains with losses around the 1.3500 neighbourhood on Tuesday. Indeed, Cable struggles to further extend its incipient recovery in a context of continuous instability in the Middle East and modest gains in the Greenback.

EUR/USD alternates gains with losses near 1.1540

EUR/USD navigates a tight range near 1.1550 in the latter part of Tuesday’s NA session. The US Dollar’s vacillating price action accompanies the pair while market participants gear up for the crucial US inflation data due on Wednesday.

Gold loses the grip below $4,400

Gold retreats from its earlier tops and briefly revisited the $4,350 region per troy ounce on Tuesday. The yellow metal’s modest retracement follows lacklustre gains in the US Dollar and declining US Treasury yields across the curve, all amid steady uncertainty from the geopolitical landscape.

Shiba Inu Price Forecast: SHIB extends sell-off despite surging futures Open Interest

Shiba Inu (SHIB) maintains a bearish outlook on Tuesday, as it edges lower at $0.00000450. This marks the seventh day the meme coin has sustained a sell-off, weighed down by a weak technical structure. Shiba Inu derivatives continue to gain momentum, with perpetual futures Open Interest (OI) rising to 11.08 trillion SHIB on Tuesday, from 10.46 trillion the day before.

The inflation narrative is still way more important than the employment story

Core bonds sold off yesterday with the belly of the curve slightly underperforming in the US while European curves showed more of a bear flattening. Daily changes on the US curve varied between +4.7 bps (2-yr) and +6.4 bps (7-yr).

9-3: Is the Federal Reserve’s vote tally Warsh's new forward guidance?

The rate did not move. Neither did the statement, and that’s the more interesting fact. Set the July 29 Federal Open Market Committee (FOMC) statement beside the one issued on June 17, and the two documents are identical apart from a single verb and a paragraph at the bottom naming three dissenters.