USDJPY Returns Below Swing Zone, But Rebounds


USDJPY attempts to rebound from early declines

The USDJPY

USD/JPY

USD/JPY is the currency pair comprising the United States dollar (symbol $, code USD) and the Japanese yen from Japan (symbol ¥, code JPY). The pair’s rate indicates how many Japanese yen are needed to buy one US dollar. For example, when USD/JPY is trading at 100.00, it means that 1 US dollar equals 100 Japanese yen. The US dollar (USD) is the most traded currency in the world, while the Japanese yen is the third most traded currency in the world, resulting in an extremely liquid pair and very tight spreads, often staying within range from 0 pip to 2 pip in most markets. currency brokers. Although the USD/JPY range has traditionally not been particularly high, the lack of significant price action often associated with other JPY pairs makes it easier to trade. This is especially true for short-term traders, although without offering a good pip potential. Even though USD/JPY is the second most traded pair in the world, it is not as popular as one might think when it comes to retail traders. Trading USD/JPY The JPY is highly regarded as a safe-haven currency, with investors often increasing their exposure after periods of uncertainty or market-induced fallout. The United States and Japan being highly developed economies, several key factors affect the value. of either currency. This includes a range of economic indicators such as gross domestic product (GDP) growth, inflation, interest rates and unemployment data. The monetary policy of the US Federal Reserve and the Bank of Japan is also a determining factor in the value of each currency.

USD/JPY is the currency pair comprising the United States dollar (symbol $, code USD) and the Japanese yen from Japan (symbol ¥, code JPY). The pair’s rate indicates how many Japanese yen are needed to buy one US dollar. For example, when USD/JPY is trading at 100.00, it means that 1 US dollar equals 100 Japanese yen. The US dollar (USD) is the most traded currency in the world, while the Japanese yen is the third most traded currency in the world, resulting in an extremely liquid pair and very tight spreads, often staying within range from 0 pip to 2 pip in most markets. currency brokers. Although the USD/JPY range has traditionally not been particularly high, the lack of significant price action often associated with other JPY pairs makes it easier to trade. This is especially true for short-term traders, although without offering a good pip potential. Even though USD/JPY is the second most traded pair in the world, it is not as popular as one might think when it comes to retail traders. Trading USD/JPY The JPY is highly regarded as a safe-haven currency, with investors often increasing their exposure after periods of uncertainty or market-induced fallout. The United States and Japan being highly developed economies, several key factors affect the value. of either currency. This includes a range of economic indicators such as gross domestic product (GDP) growth, inflation, interest rates and unemployment data. The monetary policy of the US Federal Reserve and the Bank of Japan is also a determining factor in the value of each currency.
Read this term retraced some of the gains from yesterday’s sharp rise. Recall that during the US session, the price moved above a swing zone between 129.63 and 129.787. This placed the price between the aforementioned swing zone and a higher zone at 130.49 to 130.55 (the pair traded high and low in the choppy trades between these swing zones from April 28 to May 12 – with failed breaks above and below the zone).

Today’s high price hit 130.235 at the start of the Asian session, but retraced lower. This move took price past the swing low zone at 129.63, but price has since moved back above the upper end of that swing zone at 129.787. It looks like a failed break on the downside.

For USDJPY bulls, stay above the aforementioned swing zone to 129.633 and there should be more upside sounding with the daily high at 130.235 and the swing zone between 130.49 and 130 .55 as next goals. Above this, traders would look to 130.801 and the April and May swing highs between 131.24 and 131.34. These levels were 20-year highs.

When talking about 20-year highs, traders get nervous, which can lead to reluctant buying. However, the Bank of Japan intends to keep the stimulus in play. Meanwhile, the Federal Reserve intends to slow inflation by tightening rates to a neutral level at 2.5% by the end of the year. end of the year and maybe even higher. Central bank divergence is often a catalyst for trends in currency markets.

Looking more broadly at the daily chart below, price declines from 20-year highs reached in April and May have come to a halt near a swing high from April 13 at 126.31 (price low reached 126.34), and well above the swing high dating back to March 28 at 125.076. The corrective move was also well below the 38.2% retracement of the last uptrend move. This level comes in at 124,819. Failure to meet these targets allowed buyers to maintain control over the longer term and contributed to the higher rally.

USDJPY

USDJPY on the daily chart


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