FXOpen
As of Friday morning, the situation on the USD/JPY market deserves attention:
→ the US dollar is on course to demonstrate its strongest week since July 2023. The media writes that markets are adjusting expectations regarding the easing of monetary policy by the Fed.
→ The yen fell about 3% against the US dollar in the first week of the year, which could be its weakest weekly performance since August 2022.
The USD/JPY chart shows that:
→ the price moves within the descending channel (shown in red). Growth at the beginning of the year expanded its boundaries along the principle of a parallel channel.
→ the median line has been broken by the bulls. The price action around 142 shows increased demand. The price could not consolidate below this level in December, serving as a powerful support for ending panic on December 7 and 14-15. Also, demand forces did not allow the price to reach the lower border of the channel on December 28.
Note that the bulls managed to break above the psychological level of 145, something they failed to do on December 19 when a notable high was formed. Thus, the market is in a vulnerable position for a pullback from the upper boundary of the channel after rapid growth in the first days of the year. If this happens, a false bullish breakout of the psychological level of 145 will form on the chart. The bears will have a chance to resume the trend, but given the listed signs of demand strength around the 142 yen per dollar level, they will have to make significant efforts to do this.
Be careful, today at 16:30 GMT+3 there will be news on the labour market in the US, which may affect the USD exchange rate.
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This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
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