The USDJPY moved to a brand new cycle excessive (and highest stage since 2020) within the Asian session with a transfer as much as 126.74. The excessive worth from Friday reached 126.67 earlier than modestly retracing into the shut. The Good Friday closing stage was close to 126.40. The present worth is buying and selling at 126.56 with the swing low worth within the Asian session reaching right down to 126.23.
As outlined in a post on Friday, merchants who’ve bought as a result of the USDJPY is overbought, have needed to take care of progressively greater ranges on most buying and selling days. One of many fundamental catalysts is the yield unfold between US and Japan yields are persevering with to rise as US Federal Reserve coverage is concentrated on elevating charges, whereas the BOJ is content material to maintain charges the place they’re (and suppressed long term charges within the course of).
Admittedly, the momentum to the upside is slowing a bit . The topside trendline on the hourly chart above has NOT been examined right now (see hourly chart above).
Wanting on the 5 minute chart under, the worth motion has been buying and selling above and under its 100 and 200 bar transferring averages (blue and inexperienced traces within the chart under). Nonetheless, of word intraday, is that the final transfer to the upside has seen some sellers in opposition to the close to converged transferring common ranges. That provides the shorter-term intraday bias a small tilt to the draw back. Bear in mind for the little nuances from the 5 minute chart chart for potential clues.
General, the extra consolidative buying and selling has allowed for the 100 hour transferring common to proceed to maneuver nearer to the present worth (see blue line on the hourly chart above). That 100 hour transferring common continues to be some 60 pips away from the present stage (transferring averages at 125.928). There may be extra work to be from the sellers.
Recall from final Thursday, the worth did dip under the 100 hour transferring common for the primary time since April 1, however couldn’t maintain draw back momentum (there was assist close to the swing excessive from March 28 that held assist).
If the sellers are to be taken critically, getting -and staying under – the 100 hour transferring common could be Step 1 off the hourly chart. Step 2, could be a transfer under the 200 hour transferring common (inexperienced line within the chart above). Absent that, and the sellers will not be taking again management. The development would stay extra bias to the upside not less than within the intermediate time period.