USDJPY started the week with a 1.3% fall on Monday, where it fell from opening levels around its weekly highs at 143.88, to a low at 141.92 and has since stayed relatively quiet. However, that could all change as we move through towards Friday, as FX markets move into a 3-day period packed with important scheduled events.
Risk sentiment towards US assets, and USDJPY in particularly, could be impacted by todays preliminary US Q1 GDP release at 1330 BST, which could indicate whether the US economy experienced a bigger slowdown at the start of 2025 than initially anticipated.
Then, later in the day the Fed’s preferred gauge of inflation, the PCE Index is released at 1500 BST, and this is followed by the earnings updates from US technology giants Microsoft and Meta later in the evening.
If that wasn’t enough to potentially increase USDJPY volatility, the Bank of Japan (BoJ) will post its interest rate decision early on Thursday morning. Although no change is expected due to the current uncertain tariff impacted climate and on-going trade deal negotiations with the US, the press conference led by BoJ Governor Ueda could contain some market moving commentary.
This all culminates on Friday’s US Non-farm Payrolls update at 1330 BST, where all eyes may well be focused on the unemployment rate print, currently 4.2%, to see if the US labour market is weakening, which if it is, could open the possibility of Fed rate cuts.
Technical Update: 144.06 Resistance Holds Latest Recovery
Having approached 139.58, the September 16th 2024 low trade, USDJPY has seen a recovery in price. However it could be argued, this appears a reaction to what were likely over-extended downside conditions, in place after the 7.50% decline from 151.21, the March 28th 2025 high.
Importantly, latest price strength has been held and so far, reversed by 144.06, the 38.2% Fibonacci retracement of March 28th to April 22nd weakness, which traders are likely to continue to focus on, as a potential resistance.
The BoJ announcement and data releases this week have potential to be important sentiment drivers for USDJPY, and we must be aware of support and resistance levels that may help us gauge the next direction of future price moves.
Resistance Levels:
As we have said, so far, recent recovery themes have been unable to break above 144.06 retracement resistance, which will likely be an area that needs to give way on a closing basis to suggest possibilities of a more extended phase of price strength.
While much will depend on the market’s reaction to up and coming events and future price trends, 144.06 closing breaks might suggest scope towards 145.43 the higher 50% Fibonacci level, even 146.80, the 62% retracement.
Support Levels:
Having seen Monday’s decline, price activity is back to what might be a support focus for traders at 142.00, equal to half recent strength.
Closing breaks of 142.00 may be an indication of potential for further declines, although it is possible the 139.58 September 16th 2024 low may need to give way on a closing basis to suggest possibilities of increasing downside pressure on price.
The material provided here has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
Risk sentiment towards US assets, and USDJPY in particularly, could be impacted by todays preliminary US Q1 GDP release at 1330 BST, which could indicate whether the US economy experienced a bigger slowdown at the start of 2025 than initially anticipated.
Then, later in the day the Fed’s preferred gauge of inflation, the PCE Index is released at 1500 BST, and this is followed by the earnings updates from US technology giants Microsoft and Meta later in the evening.
If that wasn’t enough to potentially increase USDJPY volatility, the Bank of Japan (BoJ) will post its interest rate decision early on Thursday morning. Although no change is expected due to the current uncertain tariff impacted climate and on-going trade deal negotiations with the US, the press conference led by BoJ Governor Ueda could contain some market moving commentary.
This all culminates on Friday’s US Non-farm Payrolls update at 1330 BST, where all eyes may well be focused on the unemployment rate print, currently 4.2%, to see if the US labour market is weakening, which if it is, could open the possibility of Fed rate cuts.
Technical Update: 144.06 Resistance Holds Latest Recovery
Having approached 139.58, the September 16th 2024 low trade, USDJPY has seen a recovery in price. However it could be argued, this appears a reaction to what were likely over-extended downside conditions, in place after the 7.50% decline from 151.21, the March 28th 2025 high.
Importantly, latest price strength has been held and so far, reversed by 144.06, the 38.2% Fibonacci retracement of March 28th to April 22nd weakness, which traders are likely to continue to focus on, as a potential resistance.
The BoJ announcement and data releases this week have potential to be important sentiment drivers for USDJPY, and we must be aware of support and resistance levels that may help us gauge the next direction of future price moves.
Resistance Levels:
As we have said, so far, recent recovery themes have been unable to break above 144.06 retracement resistance, which will likely be an area that needs to give way on a closing basis to suggest possibilities of a more extended phase of price strength.
While much will depend on the market’s reaction to up and coming events and future price trends, 144.06 closing breaks might suggest scope towards 145.43 the higher 50% Fibonacci level, even 146.80, the 62% retracement.
Support Levels:
Having seen Monday’s decline, price activity is back to what might be a support focus for traders at 142.00, equal to half recent strength.
Closing breaks of 142.00 may be an indication of potential for further declines, although it is possible the 139.58 September 16th 2024 low may need to give way on a closing basis to suggest possibilities of increasing downside pressure on price.
The material provided here has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research, we will not seek to take any advantage before providing it to our clients.
Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.
Global risk Warning CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading in CFDs. You should consider whether you understand how CFD
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Global risk Warning CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading in CFDs. You should consider whether you understand how CFD
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.