USDJPY Analysis
| Performance after Monday | |||||
| Period | Pct | Chg | Momentum | ||
| Monday | -0.7% | -106 Pips |  |
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| Week to-date | -0.68% | -102 Pips | |
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| March | -0.68% | -102 Pips | |
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Upcoming key events (London Time)
Wed 12:30 AM JPY Bank of Japan Governor Kazuo Ueda speech
What happened lately
In Japan, the unemployment rate witnessed a slight increase, moving from 2.4% in December to 2.5% in January, as reported by the Statistics Bureau of Japan. This marginal rise in unemployment might reflect the challenges in Japan’s labor market as the nation grapples with ongoing economic uncertainties. Despite being low on a global scale, any uptick can signal potential issues in the economy’s health, such as decreased demand for labor or slowing economic growth. The increase, however, is not substantial enough to cause major concern but requires close monitoring to ensure it doesn’t signal a larger, underlying problem in the economy.
In the foreign exchange market, USDJPY fell by 0.7% to 149.49. This drop indicates a consolidation phase for the currency pair, suggesting that traders are observing market conditions before taking larger positions. The downward movement could be attributed to various factors, including the slight increase in Japan’s unemployment rate, which might have impacted sentiment around the Japanese yen. The upcoming high-impact event, particularly the scheduled speech by Bank of Japan Governor Kazuo Ueda, is likely to be watched closely by market participants for any hints of future monetary policy directions that could influence the yen’s strength.
The slight rise in Japan’s unemployment rate might put pressure on the yen if it signals potential economic slowdowns, as investors may expect the Bank of Japan to hold or introduce accommodative monetary policies. This sentiment could weaken the yen against the US dollar, possibly providing support to the USDJPY pair. Conversely, if investors view the unemployment change as inconsequential or anticipate positive outcomes from upcoming policy decisions, the pair might stabilize or move lower. Traders will also be particularly attentive to Governor Ueda’s speech for any insights into Japan’s economic policy outlook. His statements could lead to increased volatility in the USDJPY pair, depending on the market’s reaction to his insights on the economy and monetary stance.
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What can we expect from USDJPY today?
USDJPY on Monday dropped -0.7% to 149.49. Price is below 9-Day EMA while Stochastic is falling.
Updated daily direction for USDJPY looks mixed as the pair is likely to consolidate above 148.62 (S1).
Looking ahead today, to see upside interest, we prefer to look at price breakout of last daily high of 151.30 or trades above daily pivot 149.96. While to the downside, the daily low of 149.10 and 148.62 (S1) as immediate support levels. USDJPY need to break on either side to indicate a short-term bias. A close below 149.10 would indicate selling pressure.
For the week to-date, take note that USDJPY is mixed as compared to prior week.
Key levels to watch out:
| R3 | 153.03 |
| R2 | 152.17 |
| R1 | 150.83 |
| Daily Pivot | 149.96 |
| S1 | 148.62 |
| S2 | 147.75 |
| S3 | 146.41 |