บทที่ 45 06/27 USDJPY: Will the Bank of Japan Intervene at 145.00?
Abstract: The USDJPY faces further upward pressure near the key resistance level of 144.00. At present, the USDJPY has fallen slightly, but the upward trend is still stable, because the market bet on the Bank of Japan (BOJ) to continue to implement monetary easing.
Fundamentals
If the exchange rate of the USDJPY reaches 145.00, rumors about the possible intervention of the BOJ are circulating in the foreign exchange market. At present, the transaction price is 143.50, which has attracted the attention of investors.
The last time the BOJ intervened in the money market was when the exchange rate of the USDJPY soared to a high of 151.50, which was also the highest level since 1998. The reason for the intervention is the need to solve the excessive weakness of the JPY and its potential negative impact on Japanese exports. The current market trend reminds people that when the exchange rate is destructive, the BOJ may take decisive action.
On the other hand, the USD may continue to strengthen due to the intention of Federal Reserve Chairman Powell to raise interest rates further to cope with the potential inflationary pressure. Differences in monetary policy between the U.S. and Japan may significantly affect the exchange rate of the USDJPY. Investors should pay close attention to developments and assess the possibility of intervention and the broader market trends and basic factors affecting the exchange rate of the USDJPY.
Technical Analysis
The USDJPY continues to maintain a firm bullish tone. Tuesday's European session traded near the multi-month high of 143.93, which is a real picture of bulls regaining momentum after Monday's suspension.
At the same time, the USDJPY remained above the key Fibonacci threshold of 142.50 (61.8% of 151.94/127.22) for the fourth consecutive day, which increased the bullish prospect.
The recent trend is still supported by the bullish trend in the 1D timeframe. The strong positive momentum and SMA are in a completely bullish configuration. Although the overbought situation warns that the bulls will face a deep correction if they continue to rise, the market fundamentals do not support this argument, which makes the bulls fall into consolidation in the process of further upward movement.
At the same time, investors are more cautious after Japanese officials may soon make remarks about intervening to prevent the JPY from falling.
On the upside, bulls need to pay attention to the psychological target of 145.00, and the next target is 146.10. Holding this level will consolidate the upward trend until the psychological threshold of 150.00.
Alternatively, a bear break below key support at 142.50 and the 10-day SMA at 142.15 would rule out the current upside momentum and signal a possible further pullback to 140.90 and psychological support at 140.00. A break below the June 1 low at 138.43 would mark the official opening of the reversal.
Overall, the market's past bets are worth learning. After investors wait for the price to adjust back to the upward Wave 4 structure, it is recommended to buy the dips.
Trading Recommendations
Trading direction: Long
Entry price: 142.80
Target price: 145.94
Stop loss: 138.43
Deadline: 2023-07-11 23:55:00
Support: 142.94, 142.50, 142.15, 141.86
Resistance: 143.87, 144.56, 145.10, 146.10
