This is not a successful year for the Japanese Yen (JPY). As of January 2022, the Japanese currency lost more than 10% against the US dollar. The yen recorded particularly severe losses from the beginning of March this year. – where, after a short consolidation, the last 7 weeks is a continuous strong upward trend in the pair USDJPY and a loss of JPY to USD more than 11%.
The difference in interest rates in the US and Japan is the reason for the weakening of the yen
The hawkish Fed could push the USDJPY pair to its 2002 highs
completing inverted RGR and attacking the neckline very likely
The weakness of the yen is due to the difference in interest rates between the US and Japan. This difference is widening and hence the USDJPY pair is heading strongly north. The yield on US 10-year bonds today reached 2.88%, which is the highest level since 2019. At the same time, Japanese bonds are reporting a yield of 0.24%. Forecasts for the following weeks indicate further weakening of the yen and USDJPY may soon reach 130 yen per dollar USD.
In early May, we will know the decisions of the FED on US interest rates. For several weeks we have been hearing about plans to raise rates by 0.5%, and the market price the probability of such a hike at 88/12, which is close to certainty. Rising inflation in the US (8.5%) forces the FED to tighten its monetary policy, there are plans to raise rates at each subsequent FOMC meeting, ie every 6 weeks. At the end of 2022,% rates may be in the range of 2.5-3.0%.
USDJPY Monthly – Price Reaches Reverse RGR Neck Line Last week, USDJPY broke its 20-year high (126) and continues to move north. Bank of Japan officials have recently expressed concern about the sharp decline in the value of the yen (verbal interventions), but refrain from any financial action in this regard. It is unlikely that the BoJ will intervene, except as a last resort to keep the 10-year JGB yield below 0.25%, which is the bank’s set limit. On the monthly chart, the price reaches inverted RGR neck line – (head-to-shoulder formation). Breaking the neckline may be a signal of a continuation of the uptrend started at the beginning of March. As of today, this is an uptrend instrument, and one should look for buying opportunities after deeper corrections with the target of $ 130 / JPY.
Tuesday afternoon tea at the live charts 17: 30-18: 30
In March, the Live Trading session will be broadcast every Tuesday on the youtube channel of the Comparic24 internet television. I invite you to Tuesday, April 19 at 17: 30-18: 30. Free entrance. Live broadcast on youtube.
Attend the Live Trading session every Wednesday at 3:30 PM
On Wednesday, April 20, at. At 3:30 PM we start our weekly live trading session. We will discuss the current macroeconomic situation, currency pairs and commodities. The registration link is here, join the Live Trading Room! More info on the group: https://t.me/Darkaforexpopolsku See other phrases most searched for today: mercator shares recommendations | kghm course | dom development share price |
Follow us on Google News. Search what is important and stay up to date with the market! Watch us >>
