USDJPY has been trading lower as of late. The pair halted previous upward move at the 200-session moving average last week and a pullback was launched as issues in the US banking sector began to mount. Move on the pair was driven, on one hand, by drop in US yields and resulting USD weakening, and on the other hand by strengthening of JPY which benefited from safe haven flows. As a result, the pair is already trading around 3% below a local high reached on March 9, 2023. USDJPY tested support zone ranging around 133.00 handle, and marked with 50-sesion moving average (green line) and 23.6% retracement of the downward impulse launched in late-October 2022, but failed to break below it yesterday. An attempt to launch a recovery move can be spotted today with the pair bouncing off the aforementioned 133.00 zone. A near-term resistance zone to watch can be found around 2% above the current market quote and is marked with the 38.2% retracement in the 136.75 area.
When it comes to potential near-term drivers for USDJPY, there are few to focus on. Firstly, developments in the US banking sector should be watched closely as they have significantly lower market expectations for rate hikes in the United States. Secondly, US CPI and retail sales data for February will be released today at 12:30 pm GMT and tomorrow at 12:30 pm GMT, respectively. Those readings will further shape expectations ahead of next week's FOMC decision. Last but not least, Bank of Japan is set to releases minutes from its latest meeting during the upcoming Asian session (around 11:50 pm GMT today) but this piece of data rarely tends to have a major impact on the markets.
Start investing today or test a free demo
Create account Try a demo Download mobile app Download mobile app
Source: xStation5
The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
