USD/JPY falls more than 250 pips after US CPI


  • US inflation slows more than expected in November.
  • Japanese yen soars across the board following the report.
  • USD/JPY drops below 135.00 to one –week lows.

The USD/JPY collapsed after the release of US inflation data. The pair dropped from 137.60 to as low as 134.60, reaching the lowest level in a week and approaching the multi-month low of 133.58.

Inflation slows down, FOMC meeting

The US Consumer Price Index rose in November by 0.1%, below the 0.3% of market consensus. The annual rate fell from 7.7% to 7.1%, reaching the lowest level in almost a year. Inflation numbers eased expectations about the future path of Fed rate hikes.

Following the numbers the US dollar collapsed across the board and the Japanese Yen soared, boosted by a rally in Treasuries. US bond yields sank with the US 10-year falling from 3.60% to 3.43%. The DXY is falling by 1.15% under 104.00.

On Wednesday, the Federal Reserve will announce its decision on monetary policy. A 50 basis points rate hike is expected. New macroeconomic forecast will be released. Powell will hold a press conference.

USD/JPY looking at the recent low

The sharp decline in USD/JPY damaged significantly the outlook for the Dollar. Price is back under the 200-day Simple Moving Average. Currently is testing the 135.00 area and a break under 134.60 would expose the next support around 134.10. Below attention would turn to the monthly low at 133.60.

Technical levels

USD/JPY

Overview
Today last price 134.84
Today Daily Change -2.88
Today Daily Change % -2.09
Today daily open 137.72
 
Trends
Daily SMA20 138.31
Daily SMA50 143.21
Daily SMA100 141.1
Daily SMA200 135.16
 
Levels
Previous Daily High 137.85
Previous Daily Low 136.45
Previous Weekly High 137.86
Previous Weekly Low 134.13
Previous Monthly High 148.82
Previous Monthly Low 137.5
Daily Fibonacci 38.2% 137.31
Daily Fibonacci 61.8% 136.98
Daily Pivot Point S1 136.83
Daily Pivot Point S2 135.94
Daily Pivot Point S3 135.42
Daily Pivot Point R1 138.23
Daily Pivot Point R2 138.74
Daily Pivot Point R3 139.64

 

 

Share: Feed news

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. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

GBP/USD battles 1.3000 ahead of UK employment data

GBP/USD battles 1.3000 ahead of UK employment data

GBP/USD treads water at around 1.3000 early Thursday, holding its retreat from 2024 highs of 1.3045. Broad US Dollar resurgence and a risk-off mood weigh on the pair, as traders await the UK employment data for fresh trading impulse. 

GBP/USD News

EUR/USD trades with bearish bias below 1.0950 ahead of ECB rate decision

EUR/USD trades with bearish bias below 1.0950 ahead of ECB rate decision

The EUR/USD pair trades on a weaker note around 1.0935, snapping a two-day winning streak during the early European session on Thursday. The Greenback edges higher as traders turn cautious ahead of the European Central Bank's monetary policy meeting later in the day. 

EUR/USD News

Gold keeps sight on $2,500 amid trade woes, Fed rate-cut bets

Gold keeps sight on $2,500 amid trade woes, Fed rate-cut bets

Gold price has found fresh demand above $2,450 in early trading on Thursday, looking to regain upside momentum, following a brief correction from a new record high of $2,484 set on Wednesday.

Gold News

Worldcoin price sets for a rally following the breakout of the descending trendline

Worldcoin price sets for a rally following the breakout of the descending trendline

Worldcoin price faces a descending trendline on Thursday; a breakout signals a bullish move. On-chain data shows that WLD's daily active addresses are increasing, signaling greater blockchain usage. 

Read more

ECB preview: Incoming data since June unlikely to shift the policy view

ECB preview: Incoming data since June unlikely to shift the policy view

Since the last ECB meeting five weeks ago in June, only a limited amount of new economic data has become available, and this data is unlikely to have significantly changed the ECB's perspective on the economy and consequently its policy stance.

Read more

Forex MAJORS

Cryptocurrencies

Signatures