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by The Japanese yen experienced a significant dip, falling beyond 149 against the dollar, although it later recovered some of its losses. This fluctuation caught the attention of Atsushi Mimura, Japan’s lead currency official, who issued a stern warning against speculative trading that could destabilize the market.
The USD/JPY daily chart below demonstrates the current price of the currency pair.
USDJPY Fundamental Analysis – 7-October-2024
Economic Caution from Japan’s Leadership
The decline in the yen’s value can be traced back to the statements made by Shigeru Ishiba, the newly appointed Prime Minister, and his economy minister, Ryosei Akazawa, the previous week.
Both officials were cautious about the immediate escalation of interest rates, considering the present economic scenario. Their comments have led to carefully evaluating Japan’s financial health, which influences currency values.
Impact on U.S. Economic Performance
The unexpectedly robust U.S. employment report released last Friday compounded the yen’s challenges. The strong job growth figures led investors to adjust their expectations, significantly reducing the likelihood of a 50 basis point reduction in U.S. interest rates this November.
USDJPY Analysis – 7-October-2024
USDJPY Analysis – 7-October-2024
FxNews—The USD/JPY has been trading bullish from 139.5, eased when the pair peaked at the 149.4 resistance. As of this writing, the pair trades at about 148.0, testing the broken trendline as support.
The Awesome oscillator histogram turned red and decreased toward the signal line from above. Additionally, the stochastic oscillator and RSI 14 are dipping from the oversold territory.
This development in the technical indicators suggests the bear market is strengthening.
From a technical perspective, if the price falls below the immediate support at 146.8, a new bearish wave will be initiated. In this scenario, the bearish momentum that began at 149.4 will likely extend to the next support level, backed by the 100-period simple moving average at 144.5.
Conversely, if the bulls close and stabilize the price above the 149.4 resistance, the uptrend will be triggered again, and the bull’s patch to the 151.0 resistance area will likely be paved. (Source FxNews—USD/JPY Technical Analysis)
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