USD/JPY jumps to fresh daily top, further beyond mid-115.00s ahead of Powell

A combination of factors assisted USD/JPY to regain positive traction on Tuesday.
A positive risk tone undermined the safe-haven JPY and extended some support.
Fed rate hike bets acted as a tailwind for the USD and also provided a modest lift.

Haresh Menghani FXStreet

The USD/JPY pair built on its steady intraday positive move and climbed to a fresh daily high, around the 115.65 region during the early North American session.

Having defended the key 115.00 psychological mark, the USD/JPY pair caught some fresh bids on Tuesday and has now reversed the previous day's losses to a one-week low. This marked the first day of a positive move in five sessions and was sponsored by a combination of supporting factors.

A generally positive tone around the equity markets undermined the safe-haven Japanese yen and acted as a tailwind for the USD/JPY pair. On the other hand, the prospects for a faster policy tightening by the Fed extended some support to the US dollar, which provided an additional lift to the pair.

It is worth mentioning that the money markets have fully priced in the possibility of an eventual Fed lift-off in March. The market bets were reinforced by comments from Atlanta Federal Reserve President Raphael Bostic, saying that March would be a reasonable time for the first-rate increase.

Bostic added that the runoff of the balance sheet could begin soon after and expects three rate hikes in 2022, with risks pointing towards a fourth on the possibility of higher inflation. Hence, the focus will remain on Fed Chair Jerome Powell's confirmation hearing before the Senate Banking Committee.

Investors will closely scrutinize Powell's remarks for clues about the likely timing and the pace of policy normalisation. Apart from this, Wednesday's release of the US consumer inflation figures will play a key role in influencing the USD and provide a fresh directional impetus to the USD/JPY pair.

Meanwhile, the fundamental backdrop seems tilted in favour of bullish traders and suggests that the recent corrective slide from a five-year high touched last week has run its course. Hence, some follow-through strength, towards reclaiming the 116.00 mark, remains a distinct possibility.

Technical levels to watch

USD/JPY

Overview
Today last price	115.59
Today Daily Change	0.34
Today Daily Change %	0.30
Today daily open	115.25

Trends
Daily SMA20	114.74
Daily SMA50	114.19
Daily SMA100	112.83
Daily SMA200	111.24

Levels
Previous Daily High	115.85
Previous Daily Low	115.04
Previous Weekly High	116.35
Previous Weekly Low	114.95
Previous Monthly High	115.21
Previous Monthly Low	112.56
Daily Fibonacci 38.2%	115.35
Daily Fibonacci 61.8%	115.54
Daily Pivot Point S1	114.91
Daily Pivot Point S2	114.57
Daily Pivot Point S3	114.1
Daily Pivot Point R1	115.72
Daily Pivot Point R2	116.19
Daily Pivot Point R3	116.53

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

AUD/USD consolidates above 0.7000; remains close to monthly top

AUD/USD holds steady above 0.7000 during the Asian session on Friday, trading just below the previous day's monthly low amid diverging forces. A hawkish RBA continues to support the Aussie, while the recent decline in US bond yields keeps the US Dollar depressed near a three-week low. However, oil-driven inflation fears reinforce Fed hike bets, which, along with geopolitical risks, could benefit the safe-haven buck and cap the currency pair.

USD/JPY bounces off one-month low; climbs to 157.00 amid reviving USD demand

USD/JPY rebounds from the 156.00 neighborhood, or a one-month low touched during Friday’s Asian session, with bulls looking to extend momentum beyond 157.00 amid the emergence of some US Dollar buying. Meanwhile, Japan's National CPI rose to a nine-month peak and reaffirmed BoJ rate-hike bets, which could support the Japanese Yen and cap gains for the currency pair.

Gold treads water around $4,000

Gold prices maintain its offered stance in place at the end of the week, hovering around the key $4,000 threshold per troy ounce. The persistent selling bias in the precious metal comes amid decent gains in the US Dollar and an acceptable rebound in US Treasury yields across the curve, all alongside further upside traction in crude oil prices.

Crypto Today: Bitcoin holds the 50-day EMA as Ethereum and XRP face structural resistance

Bitcoin gradually ticks up on Friday, trading above $81,000. The Crypto King has recently defended structural support near $80,000, reinforcing the prevailing bullish outlook. Ethereum similarly edges higher above $2,400, while Ripple trades above $1.32 after testing support around $1.30.

The French bond panic is overdone. Here's what the market is misreading

France's 10-year government bond yield has climbed above 5%, reigniting fears of a sovereign debt crisis in the Eurozone. With public debt exceeding €3.5 trillion, persistent budget deficits and a fragmented political landscape, investors are increasingly questioning the French government's ability to stabilize its finances.

What November 3 means for the Fed's rate path and the US Dollar

The USD faces a decisive period ahead of the November 3 midterm elections. While markets anticipate another interest rate increase from the Fed in December, the battle for control of Congress could reshape fiscal policy expectations and, indirectly, the path of US monetary policy in 2027.