The USD/JPY pair is back in the spotlight as it climbs higher, fueled by diverging monetary policies between the U.S. Federal Reserve and the Bank of Japan. Currently trading at 155.82, the pair has gained 0.76% in the latest session, drawing attention from forex traders. But can the bullish momentum hold?
The Japanese yen is under pressure as Japan’s loose monetary policies clash with the Federal Reserve’s tighter stance, widening the yield gap and boosting the dollar’s appeal. Strong U.S. retail sales data has further strengthened the greenback, while limited intervention by Japan has left the yen vulnerable.
The daily chart highlights USD/JPY’s bullish trend, with the pair trading close to a key resistance level. Here’s what traders should note:
The USD/JPY momentum looks strong for now, but traders should stay alert to key economic updates and any moves by central banks. If the Bank of Japan intervenes or the Federal Reserve changes its tone, the pair’s direction could quickly shift.
At the moment, technical indicators suggest there’s room for more upside. However, if USD/JPY struggles to clear the 156.60 resistance, we might see some profit-taking and a potential pullback in the short term.
The pair’s next move will largely depend on whether it can clear the 156.60 resistance level. A break above this could pave the way toward 158.37, but failure to do so might see USD/JPY retest support at 153.45. Traders should stay cautious as volatility remains high.
This post was last modified on Nov 20, 2024, 11:29 GMT 11:29