USD/JPY trades flat following US Retail Sales, still above 145.00

USD/JPY trades neutral at the 145.55 area after hitting a low of 145.10.
US Retail Sales came in strong, and the markets bet on a hike by the Fed in November.
Monetary Policies divergences weight on the JPY which couldn’t benefit from robust GDP data.

Patricio Martín FXStreet

On Tuesday, the USD/JPY traded flat while the USD seemed to consolidate. On the other hand, the JPY continues to trade vulnerable amid the extreme dovish stance of the Bank of Japan (BoJ) and monetary policy divergence between its peers.

US Retail Sales revealed that the US economy is holding strong. The headline Sales increased by 0.7% MoM, higher than the 0.4% expected, while the ones excluding the Automobile sector also came in strong and came in at 1% vs the 0.4% expected.

Regarding the next Federal Reserve (Fed) meeting, there's a prevailing market expectation of a no hike in September. However, the chances of a 25 basis point adjustment in November reach a peak of around 40%. That said, the focus now pivots to Wednesday's Federal Open Market Committee (FOMC) gathering, as investors seek hints in the forward guidance to attain a distinct perspective on the officials' position.

Despite reporting strong Gross Domestic Product (GDP) data, the JPY continues to trade weak. On Tuesday, it was reported that during the second quarter, the economy expanded by 1.5% QoQ at a 6% annualised pace in both figures. On the bright side, speculations of a potential Bank of Japan (BoJ) intervention to stop the currency's loss is the only hope for the Yen while the USD/JPY consolidated above the 145.00 level.

USD/JPY Levels to watch

The technical analysis of the daily chart supports a bullish view of USD/JPY in the short term. The relative Strength Index (RSI) maintains its favourable position above the midline, displaying an upward inclination. Moreover, Moving Average Convergence Divergence (MACD) showcases green bars, underlining the strengthening bullish momentum. Furthermore, the pair is above the 20,100,200-day SMAs, suggesting that the bulls are firmly in control of the bigger picture.

Support levels: 145.00, 144.70, 144.00.
Resistance levels: 145.70, 146.00, 146.50.

USD/JPY Daily chart

USD/JPY

Overview
Today last price	145.54
Today Daily Change	-0.01
Today Daily Change %	-0.01
Today daily open	145.55

Trends
Daily SMA20	142.09
Daily SMA50	141.82
Daily SMA100	138.65
Daily SMA200	136.47

Levels
Previous Daily High	145.58
Previous Daily Low	144.65
Previous Weekly High	145
Previous Weekly Low	141.51
Previous Monthly High	144.91
Previous Monthly Low	137.24
Daily Fibonacci 38.2%	145.23
Daily Fibonacci 61.8%	145.01
Daily Pivot Point S1	144.94
Daily Pivot Point S2	144.33
Daily Pivot Point S3	144.02
Daily Pivot Point R1	145.87
Daily Pivot Point R2	146.19
Daily Pivot Point R3	146.8

Author

Patricio Martín

FXStreet

Patricio is an economist from Argentina passionate about global finance and understanding the daily movements of the markets.

AUD/USD hangs close to monthly lows, still defends 0.7100 ahead of Fed decision

AUD/USD retains its negative bias for the third straight day, defending 0.7100 while trading close to a monthly low in Wednesday's Asian session on Wednesday. The US Dollar stands firm near a two-week high as the anticipated Fed rate hike and oil-driven inflation fears continue to push US bond yields to a multi-year high. Furthermore, escalating Middle East tensions benefit the safe-haven buck and weigh on the risk-sensitive Aussie.

USD/JPY holds firm above 155.00, awaits Fed policy announcements

USD/JPY climbs to a fresh one-week high above 155.00 in the Asian session on Wednesday amid a bullish US Dollar. Oil-driven inflation fears, along with the anticipated Fed rate hike, continue to support surging US bond yields. Moreover, rising US-Iran tensions underpin the USD's reserve currency status. The pair, however, remains below the mid-155.00s as bulls seem hesitant ahead of the Fed decision later today and the BoJ meeting, starting on Thursday.

Gold sticks to modest gains below $4,350 as USD bulls await Fed rate decision

Gold struggles to capitalize on its modest intraday move higher, and remains below the $4,350 level through the Asian session. The US Dollar pauses for a breather after touching a two-week high and offers some support to the commodity. Traders, however, seem hesitant to place aggressive directional bets and opt to wait on the sidelines heading into the key central bank event.

Bitcoin, Ethereum, and Ripple retreat as Fed rate decision looms

Bitcoin (BTC), Ethereum (ETH) and Ripple (XRP) remain under pressure and consolidate at the time of writing on Wednesday after falling more than 3%, 4% and 9%, respectively, as the Clarity Act failed to advance in the Senate on Tuesday.

Asian stocks trade with modest gains as investors remain cautious ahead of Fed decision

Asian equity markets trade with modest gains on Wednesday, tracking stability in US stock index futures, though sentiment remains cautious ahead of the highly anticipated US Federal Reserve policy decision. High oil prices, escalating Middle East tensions and surging bond yields also kept markets on edge.

How Japan became the World's Banker and why that era may be ending

Japan's ultra-low interest rates helped finance trillions of dollars in global investments for more than a decade, making the Japanese Yen one of the world’s cheapest sources of funding. With the Bank of Japan expected to tighten policy again this week, that advantage may be entering a new phase. While most major economies raised interest rates, Japan remained the world's outlier.