USD/JPY Chart Analysis: Bears Target the 150 Yen per Dollar Level
Thanksgiving in the U.S. might have been expected to bring calm to financial markets, but Forex trading in Asia tells a different story following the release of Japan's Consumer Price Index (CPI).
According to Forex Factory:
Actual = 2.2%
Forecast = 2.0%
Previous = 1.8%
Signs of sustained inflation growth have spurred currency market participants to buy yen, speculating that the Bank of Japan might raise interest rates. The upcoming December meeting could see rates increased to 0.5%, which would mark the highest level since 2008.
As a result, the yen strengthened by approximately 1% today, hitting its highest level in six weeks and briefly dipping below the psychological level of 150 yen per dollar.
Technical analysis of the USD/JPY chart:
The blue upward channel, in place since early October, has lost its strength. A downward trajectory (indicated in red) now appears more relevant on the USD/JPY chart.
A bearish breakout below the lower boundary of the blue channel occurred (marked with an arrow) near the 153.7 level. Notably, this level served as support in mid-November. Its reasonable to assume that bears now hold full control at this level, which could manifest at lower levelssuch as the 152 yen per dollar mark, where a local high was established yesterday.
If the psychological level of 150 yen per dollar acts as support, it may only lead to a temporary bounce before a new wave of bearish momentum emerges, as the market anticipates the Bank of Japan's policy meeting.
Read more: https://fxopen.com/blog/en/oa-usd-jpy-chart-analysis-bears-target-the-150-yen-per-dollar-level/
Text source: Forex Trading Blog
