USD/JPY Price Analysis: Bears are chipping away at daily dynamic support

USD/JPY bears are staring to lick their lips.
The price is breaking daily dynamic support.

Ross J Burland FXStreet

USD/JPY is up some 0.3% on the day trading at around 144.70 having travelled up from a low of 143.98 to a high of 144.91 so far. at this juncture, the Yen that's under intervention watch after the Japanese finance minister warned last week of excessive moves in the currency market.

Data on the day in the US from the Institute for Supply Management (ISM) showed that manufacturing PMI dropped to 46.0 from 46.9 in May, the lowest reading since May 2020. It marked the eighth straight month that the PMI has been below the 50 threshold indicating contraction. Consequently, USD/JPY's current bullish trend could continue to decelerate as we have seen over the last few days.

The following illustrates the prospects of a correction in a top-down analysis:

USD/JPY monthly charts

The W-formation is a reversion pattern that could play out to the downside in time.

USD/JPY weekly

The current weekly highs could be the highest pot we will see for some time and as correction back to old highs neat 140.90 could be on the cards. The 61.8% Fibonacci aligns with those as well.

USD/JPY daily chart

Nearer term, the daily chart is breaking the trendline support and a target of 142.00 aligns with old highs and a 78.6% Fibonacci level.

Author

Ross J Burland

FXStreet

Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.

AUD/USD rises to 0.6950 as USD slips on Fed's Warsh

AUD/USD regains traction and extends the bounce toward 0.6950 in the Asian session on Friday. Fed Chair Warsh's comments reinforce the selling pressure on the US Dollar, allowing the pair to stretch higher. Warsh said that he remains committed to delivering price stability without giving away anything on future interest rate path.

USD/JPY falls in symc with USD, gives up 158.00 after Warsh's speech

USD/JPY has come under fresh selling pressure and gives up 158.00 in the Asian session on Friday amid the emergence of fresh US Dollar selling. Fed Chair Warsh's non-committal commentary on the future tightening path, weighs on the US Dollar and the pair.

Gold looks vacillating above $4,150

Gold alternates gains with losses below the key $4,200 mark per troy ounce on Friday. The yellow metal’s irresolute price action comes in response to a modest pullback in the US Dollar and a tepid recovery in US Treasury yields across the board.

Bitcoin steadies at $82,000: The five forces crushing the Uptober rally

Crypto markets have remained under pressure so far in October, with Bitcoin (BTC) sliding below $80,000 earlier this week before recovering to around $82,000 on Friday, as macroeconomic headwinds and cooling demand weigh on the market.

The Fed just got a second hot inflation number. Here's what the diesel signal is really saying

The Federal Reserve (Fed) faces a renewed inflation challenge after two consecutive reports showed price pressure intensifying across the US economy. September's Consumer Price Index (CPI) confirmed accelerating consumer inflation, while the Producer Price Index (PPI) revealed an even sharper rise in business costs. Behind both reports lies a common factor: energy prices.

Everyone's dumping Gold after hot US inflation. Here's why $4,100 could be a floor, not a cliff

Gold (XAU/USD) is recovering from a sharp sell-off triggered by hotter-than-expected United States (US) inflation data released on Wednesday. The precious metal briefly plunged toward $4,073 as investors increased their bets on further Federal Reserve (Fed) interest rate hikes before recovering as US Treasury yields and the US Dollar (USD) reversed their initial gains.