Long

USD/JPY recovered the 144 level and entered the upward mode

12 hours ago

12 hours ago

Dovish comments from new Japanese Prime Minister Shigeru Ishiba, a former defense minister, put downward pressure on the yen and supported USDJPY. Ishiba said on Sunday that the country's monetary policy should remain accommodative, indicating the need to maintain low borrowing costs to support a fragile economic recovery.

The dollar rose after Powell's latest comments on Monday. Powell said the Fed is in no hurry and will lower its benchmark interest rate "over time." He added that the recent 50 basis point cut should not be taken as a sign of similarly aggressive action in the future, noting that the upcoming rate adjustment could be more dovish.

Usd/JPY surged past the 144 mark to reach the day's high of 144.40. Federal Reserve Chairman Jerome Powell struck a hawkish tone, predicting a 50 basis point rate cut by the end of the year, ending dovish expectations of a big cut. The BOJ summary indicated that it had no plans to raise interest rates further in the near term, causing the yen to weaken.

Technical analysis of USD/JPY

Usd/JPY is trading above 144. Through chart analysis, the pair has re-entered the upward channel mode, indicating that the bullish bias is still intact. In addition, the 14-day Relative Strength Index (RSI) is slightly below the 50 level, a breach of which could further confirm the continuation of the bullish trend.

In terms of resistance, USD/JPY may explore the area around the upper boundary of the uptrend channel 146.50, followed by the five-week high of 147.21 set on September 3.

On the downside, immediate support is found at the 9-day Exponential Moving Average (EMA) level of 143.51, followed by the lower boundary of the uptrend channel at 142.80. A break below this level could cause the USDJPY pair to hover around the 139.58 area, which is the lowest since June 2023.

G_James9

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