USD/JPY Consolidates its Losses at Key Tech Levels


USD/JPY Analysis

Last week's soft CPI inflation report sparked a dovish repricing in market expectations around the Fed's rate hike cycle. The central bank had previously hinted at a slower pace of tightening at some point, but is far from a pause. However, the next decision is a month away and officials will have the chance to assess two more inflation reports and a jobs report until then.

Recent Fed commentary shows some division among policy makers as to the next steps, but most seem to be contemplating smaller increases ahead, after a series of 75 basis points moves. Governor Waller (voter) said that recent data have made him "more comfortable" to consider a 50 bps adjustment, but expects hikes to continue in 2023. [1]

Ms George who is a voter this year but not in the next one, appeared more hawkish in her Wall Street Journal remarks, warning that officials must be careful "not to stop too soon". [2]

USD/JPY breached the lower border of the daily Ichimoku Cloud on Tuesday and remains in a perilous state, after its worst week in twenty-four years. The aggressive slump from last month's multi-decades high has exposed it to the 200Days EMA at around (135.47-134.60), but fresh catalyst will be required for a breach that would bring 130.38 in the spotlight.

However, the pair finds support this week and the Bank of Japan remains committed to its ultra-loose monetary tightening, in stark contrast with the Fed and its major counterparts. As such, we can see a bounce back above 141.16, but USD/JPY does not seem ready yet to move past the strong resistance area of 144.40-90.

Why Trade with FXCM

Commission free with fast, efficient execution.

Nikos Tzabouras

Senior Financial Editorial Writer

Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.

With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.



Retrieved 17 Nov 2022


Retrieved 14 Jun 2024

${} / ${getInstrumentData.ticker} /

Exchange: ${}

${} ${getInstrumentData.divCcy} ${getInstrumentData.priceChange} (${getInstrumentData.percentChange}%) ${getInstrumentData.priceChange} (${getInstrumentData.percentChange}%)

${getInstrumentData.oneYearLow} 52/wk Range ${getInstrumentData.oneYearHigh}

Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interests arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed here.

Past Performance: Past Performance is not an indicator of future results.

Spreads Widget: When static spreads are displayed, the figures reflect a time-stamped snapshot as of when the market closes. Spreads are variable and are subject to delay. Single Share prices are subject to a 15 minute delay. The spread figures are for informational purposes only. FXCM is not liable for errors, omissions or delays, or for actions relying on this information.