USDJPY Analysis
| Performance after Monday | |||||
| Period | Pct | Chg | Momentum | ||
| Monday | -0.64% | -99.4 Pips |  |
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| Week to-date | -0.64% | -99.8 Pips | |
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| January | -1.58% | -248.499 Pips |  |
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Upcoming key events (London Time)
Wed 07:00 PM USD Fed Interest Rate Decision (Federal Funds Rate)
What happened lately
In December, the United States experienced an increase in new-home sales by 3.6%, which indicates a slowdown compared to the 5.9% growth observed in November. This deceleration in the housing market may suggest a cooling trend as potential homebuyers face challenges such as higher mortgage rates or economic uncertainties. Despite the positive growth in new-home sales, the reduction in momentum could signal cautious behavior among consumers or developers due to various economic factors impacting the market environment.
The USDJPY exchange rate moved downward by 0.64% on Monday, settling at 154.50. This decline in the value of the dollar against the yen suggests a shift in market sentiment or repositioning by investors. The noted decrease could be influenced by the upcoming high-impact event of the Federal Reserve’s interest rate decision scheduled for Wednesday at 07:00 PM. The anticipation surrounding potential changes in the Federal Funds Rate might contribute to volatility in foreign exchange markets, with traders closely watching for clues regarding future US monetary policy. If the Fed signals a rate hike or a hawkish stance, it may strengthen the US dollar, which could potentially lead to an appreciation of USDJPY. Conversely, a dovish approach could weaken the dollar further, impacting the exchange rate dynamics.
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What can we expect from USDJPY today?
USDJPY on Monday dropped -0.64% to 154.50. Price is below 9-Day EMA while Stochastic is falling.
Updated daily direction for USDJPY looks bearish as the pair posted lower in Monday trading session.
Looking ahead for the day, immediate support level is at 153.39 (S1) with break below could see further selling pressure towards 152.28 (S2). To the upside, with the current momentum bearish, we prefer to look at breakout of the recent daily high of 156.25 as a potential indicator of buying interest. Failure to break the resistance level would continue to echo bearish sentiment. A close below 153.71 would indicate selling pressure.
For the week to-date, take note that USDJPY is bearish as the pair posted lower by -0.64%.
Key levels to watch out:
| R3 | 158.47 |
| R2 | 157.36 |
| R1 | 155.93 |
| Daily Pivot | 154.82 |
| S1 | 153.39 |
| S2 | 152.28 |
| S3 | 150.85 |