Market Analysis: USD/JPY at the High of the Year
FXOpen
This morning, the Japanese currency weakened to 142.25 yen per US dollar for the first time since November 2022.
This is a consequence of the difference in the monetary policies of the two countries. Last week, the Fed, although it paused in raising the rate, said that it could be raised before the end of the year. On the other hand, the Bank of Japan on Friday maintained its commitment to ultra-soft monetary policy.
The USD/JPY chart shows that the rate is moving within a long-term ascending channel (shown in blue), and today it is near its median line — it can serve as resistance, which can at least slow down the growth of the rate. Or even promote a pullback within the channel shown in yellow.
However, the series of higher lows that has been going on since March 2023 suggests that bulls are dominating the USD/JPY market and may be trying to break the median line.
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