- USD/JPY advances to fresh multi-month highs near 147.85
- US Michigan’s Consumer Sentiment came in lower than expected.
- The US DXY index reached its highest point since March 9 at 105.43 and then settled at 105.23.
- All eyes are now on the Fed’s decision next week.
Ahead of the weekend, the USD/JPY pair resumes its upward path, rising to 147.85 and on the point of recording a second consecutive week of gains. On the USD side, the Greenback trades soft and faces selling pressure after soft consumer sentiment figures from the US in September. However, the DXY index will close its eight-consecutive winning week, gaining more than 5% since July. On the other hand, the JPY has given up all gains seen by Ueda’s comments earlier this week, and the Bank of Japan's (BoJ) dovish stance, leaves the Yen vulnerable.
Investors gear up for next week’s Fed decision
During the past week, key inflation data from the US from August measured by the Consumer Price Index (CPI) came in higher than expected. In addition, economic activity figures, including Retail Sales from the same month and Jobless Claims for the second week of September, also showed good news for the US economy.
Regarding expectations on the Federal Reserve (Fed), according to the CME FedWatch tool, the odds of one last hike slightly have declined but remain relatively high, at around 35%. That decline may be explained by the European Central Bank's (ECB) dovish tone on Thursday after it decided to hike by 25 bps but Christine Lagarde refrained from committing to another hike. Nevertheless, the US economy looks like it is not cooling down, and Fed officials have all the reasons to hike one last time.
On the JPY front, as highlighted by the BoJ, local wage and inflation trends are key drivers in the decision-making process around monetary policy shifts. On Monday, Governor Ueda commented that the bank may gather enough data by years-end to consider a pivot, which lifted the Yen. That momentum slowly fade, however. For next week’s BoJ meeting, no changes in the ultra-loose policy are expected, but markets will monitor any changes in the economic forecast.
USD/JPY Levels to watch
As per the daily chart analysis, the USD/JPY has a bullish technical bias for the short term.
The Relative Strength Index (RSI) also exhibits a northward slope above its midline, emphasising the presence of strong buying pressure, while the MACD, with its green bars, highlights the strengthening bullish momentum of the USD/JPY.
On the other hand, the pair is above the 20,100,200-day Simple Moving Average (SMA), indicating that the buyers are commanding the broader perspective.
Support levels: 147.00, 146.60 (20-day SMA), 146.00.
Resistance levels: 148.00, 149.00, 150.00.
USD/JPY Daily Chart
|Today last price||147.86|
|Today Daily Change||0.38|
|Today Daily Change %||0.26|
|Today daily open||147.48|
|Previous Daily High||147.57|
|Previous Daily Low||147.02|
|Previous Weekly High||147.88|
|Previous Weekly Low||146.02|
|Previous Monthly High||147.38|
|Previous Monthly Low||141.51|
|Daily Fibonacci 38.2%||147.36|
|Daily Fibonacci 61.8%||147.23|
|Daily Pivot Point S1||147.14|
|Daily Pivot Point S2||146.8|
|Daily Pivot Point S3||146.59|
|Daily Pivot Point R1||147.69|
|Daily Pivot Point R2||147.9|
|Daily Pivot Point R3||148.24|
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.