USD / JPY Technical Analysis: Bullish Breakouts are stronger

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The yen is a popular currency in times of turmoil.

Demand for the U.S. currency was strong at the start of trading this week, amid declining global markets amid renewed fears of Chinese economic woes, according to a report. new case of Covid-19 in Shanghai. As a result, the USD / JPY currency pair moved for further bullish breaks, as it jumped to the resistance level of 137.75, the highest for the currency pair in 24 years, previously. the setting is around the 137.50 level at the time of writing in the survey, awaiting any news.

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The yen is a popular currency in times of turmoil.

Investors thought China was going to ease its Covid-free path to the disease, but the news that Shanghai areas were going through a major trial led to fears of being introduced. critical limits. According to market performance, the currency is stronger in the financial basket due to global growth concerns. Those concerns were exacerbated by fears of more locks in China after Shanghai reported its first case of the omicron subtype BA.5.

Shanghai reported its first case of the BA.5 variety on Sunday and officials said the major trial for Covid would take place twice between July 12 and July 14 in nine locations. Commenting on this, Susanna Streeter, Senior Investment and Markets Analyst, Hargreaves Lansdowne, said: “Uncertainty is keeping markets afloat with growing fears of big inflation. and the slowdown of the world, and Covid’s fears are returning. ” And “the symptoms don’t end the story of The Covid horror in our roots.”

Asian and European markets are trading in the red and US stock futures pointed to a soft opening. These dynamics reflect an investor community that wants to invest in “safe -haven” funds.

The DXY dollar index – a measure of the currency’s broad -based performance based on specific market prices in the U.S. currency – is near its highest level since 2002 at 107.47.

Commenting on this, Mark Heffel, chief financial officer at UBS Global Wealth Management, said, “In the current context of risk aversion in the markets, the company’s financial services will continue to thrive. America in the near future. ” But looking to the future, the reviewer says, this strength is unlikely to last long. UBS said in a statement on Monday that the price of the currency would be restrained by higher inflation by the U.S. Federal Reserve as investors begin to push the stock price to a slow pace. property in 2023.

This could require the Fed to cut interest rates. Therefore, some analysts say investors will not take a position in order to continue the rise of the US dollar. But our favorite security currency is the Swiss franc. We want stocks, and we expect to be profitable when prices recover from the current fall.

All in all, the Japanese yen is selling faster after the Japanese government accounted for most of Sunday’s upper house elections, even as investors explained that the result as a referendum close to the country’s ultra-simple monetary policy. As a result, the Japanese currency fell 0.8% against the currency, ahead of the 137 level closely observed. Bank of Japan captain Haruhiko Kuroda said on Monday that he would not hesitate to add to inflation if the economy was to be boosted.

The rise in the treasury and strong U.S. labor data on Friday also gave a further boost to the currency, which is up for the majority of major currencies. Speaking about the deal, Tsutomu Soma, a firm trader at Monex Inc, said: Japan for a while and in the midst of the Fed’s intentions. Rate. Up to curb inflation.. In Tokyo. ”It wouldn’t be surprising if the USD / JPY tries to hit 147 or 150 that way. “

With the Bank of Japan keeping interest rates at the same level as foreign interest rates rise, the yen has fallen to a 24-year low, below 16% against the currency today. years old. The currency has been relatively short since its lowest decline, according to data compiled by Bloomberg. Japan’s election came two days after the assassination of Prime Minister Shinzo Abe, who was seen as a major supporter of the Bank of Japan.

USDJPY Technical Analysis

The USD / JPY’s usual strength of rising and holding above the 137.50 resistance will not stop the move to the psychological resistance level beyond 140.00. The sources of the strength of the US currency continue, and the Japanese yen has not benefited from attempts by investors to buy safe havens. On the downside, if there is a sell -off, which is expected to be periodic, the stock could move to the 136.80 and 135.00 support levels.

USD/JPY

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