USD/JPY Primed for Breakout, Ready to Extend Dominant Uptrend?
In the wake of the latest US CPI report, where headline inflation clocked in at 7.9% y/y (as expected), continuing to run at 40-year highs, USD/JPY has been trending higher.
The Federal Reserve is expected to commence its tightening cycle next week by raising interest rates. Its balance sheet is also no longer expanding. Front-end Treasury yields are on the rise, with the 2-year rate closing at another 2022 high.
Favorable monetary policy differentials between the Fed and BoJ may thus continue offering the fundamental fuel for keeping USD/JPY tilted upward.
The pair is testing the ceiling of an Ascending Triangle chart formation, where a breakout could hint at uptrend resumption. Such an outcome would expose the December 2016 high at 118.66. Getting there entails clearing the 100% and 123.6% Fibonacci extensions at 117.29 and 118.19 respectively.
In the event of a false breakout, keep a close eye on the floor of the chart formation, where rising support could reinstate an upside focus. Breaking under the triangle altogether could spell further losses to come.
https://www.dailyfx.com/forex/analyst_picks/todays_picks/daniel_dubrovsky/2022/03/10/Japanese-Yen-Forecast-USDJPY-Uptrend-in-Focus-as-US-Braces-for-Even-Higher-Inflation.html
USDJPY
The Federal Reserve is expected to commence its tightening cycle next week by raising interest rates. Its balance sheet is also no longer expanding. Front-end Treasury yields are on the rise, with the 2-year rate closing at another 2022 high.
Favorable monetary policy differentials between the Fed and BoJ may thus continue offering the fundamental fuel for keeping USD/JPY tilted upward.
The pair is testing the ceiling of an Ascending Triangle chart formation, where a breakout could hint at uptrend resumption. Such an outcome would expose the December 2016 high at 118.66. Getting there entails clearing the 100% and 123.6% Fibonacci extensions at 117.29 and 118.19 respectively.
In the event of a false breakout, keep a close eye on the floor of the chart formation, where rising support could reinstate an upside focus. Breaking under the triangle altogether could spell further losses to come.
https://www.dailyfx.com/forex/analyst_picks/todays_picks/daniel_dubrovsky/2022/03/10/Japanese-Yen-Forecast-USDJPY-Uptrend-in-Focus-as-US-Braces-for-Even-Higher-Inflation.html
USDJPY
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