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Home ANALYSIS

USDJPY gets another boost to the upside and 122 resistance is eyed.

A.R Chowdhury by A.R Chowdhury
March 24, 2022
Reading Time: 4 mins read
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USDJPY gets another boost to the upside and 122 resistance is eyed.

The  USDJPY 
USD/JPY

The USD/JPY is the currency pair encompassing the dollar of the United States of America (symbol $, code USD), and the Japanese yen of Japan (symbol ¥, code JPY). The pair’s rate indicates how many Japanese yen are needed in order to purchase one US dollar. For example, when the USD/JPY is trading at 100.00, it means 1 US dollar is equivalent to 100 Japanese yen.  The US dollar (USD) is the world’s most traded currency, whilst the Japanese yen is the world’s third most traded currency, resulting in an extremely liquid pair, and very tight spreads, often staying within the 0 pip to 2 pip spread range on most forex brokers. Although the range of the USD/JPY isn’t traditionally particularly high, the lack of large price action often associated with other JPY pairs does make it easier to trade.This is especially true for short-term traders, although without offering a great pip potential. Even though the USD/JPY is the world’s second most traded pair, it’s not as popular as one might think with regards to retail traders.The pair carries a reputation as “boring”, although this isn’t an entirely accurate reflection. Trading the USD/JPYThe JPY is highly regarded as a safe haven currency, with investors often increasing their exposure following periods of uncertainty or market-induced fallouts.As both the US and Japan are highly developed economies, there are several key factors affecting the value of either currencies. This includes a range of economic indicators such as gross domestic product (GDP) growth, inflation, interest rates and unemployment data. Monetary policy by the US Federal Reserve and Bank of Japan are also large determinants in the value of each currency.

The USD/JPY is the currency pair encompassing the dollar of the United States of America (symbol $, code USD), and the Japanese yen of Japan (symbol ¥, code JPY). The pair’s rate indicates how many Japanese yen are needed in order to purchase one US dollar. For example, when the USD/JPY is trading at 100.00, it means 1 US dollar is equivalent to 100 Japanese yen.  The US dollar (USD) is the world’s most traded currency, whilst the Japanese yen is the world’s third most traded currency, resulting in an extremely liquid pair, and very tight spreads, often staying within the 0 pip to 2 pip spread range on most forex brokers. Although the range of the USD/JPY isn’t traditionally particularly high, the lack of large price action often associated with other JPY pairs does make it easier to trade.This is especially true for short-term traders, although without offering a great pip potential. Even though the USD/JPY is the world’s second most traded pair, it’s not as popular as one might think with regards to retail traders.The pair carries a reputation as “boring”, although this isn’t an entirely accurate reflection. Trading the USD/JPYThe JPY is highly regarded as a safe haven currency, with investors often increasing their exposure following periods of uncertainty or market-induced fallouts.As both the US and Japan are highly developed economies, there are several key factors affecting the value of either currencies. This includes a range of economic indicators such as gross domestic product (GDP) growth, inflation, interest rates and unemployment data. Monetary policy by the US Federal Reserve and Bank of Japan are also large determinants in the value of each currency.
Read this Term
continues to run to the upside. The pair is now approaching the 122.00 level. The high prices reach 121.965 so far.

Moving above the 122.00 level and staying above would push the price toward the higher extremes on the weekly chart (see earlier post HERE).

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There may be some sellers against that 122.00 level, but remember that trends are fast, directional and tend to go farther than what people expect. Sellers over the last 2-3 weeks have consistently been forced to cover fairly quickly. The price is now up 13 the last 14 trading days (assuming a higher close today). The USDJPY is up close to 740 pips from the March 4 low.

USDJPY

USDJPY continues to run higher

Looking at the 5 minute chart above, at the start of the North American session, the price was consolidating toward the rising 100 bar moving average (blue line). Buyers and sellers had a decision. The buyers won, as they pushed above the high for the day at 121.743, and continued its run to the upside after the better than expected Markit PMI data.

US yields are moving higher with the two year up now 6.2 basis points at 2.162%, the 10 year is also up 6.4 basis points at 2.359%.

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A.R Chowdhury

A.R Chowdhury

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USDCAD moves further away from its 200 day moving average

USDJPY now above 122.00 (and other JPY crosses continuing to move too).

USDJPY now above 122.00 (and other JPY crosses continuing to move too).

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