Yen Rose On Possible Japanese Intervention Fears

Fundamental Analysis

* Yen Triumph: The Japanese Yen is maintaining its rally against the US dollar amid speculation that Japan’s financial authorities have intervened for the second time this week to support the domestic currency. According to Reuters, data from the Bank of Japan on Thursday suggests that Japanese officials may have spent between 3.26 trillion and 3.66 trillion yen (equivalent to $21.01 billion to $23.59 billion) on Wednesday to prevent the yen from reaching its lowest levels in 34 years. Additionally, the central bank’s projections for Tuesday’s money market conditions indicate a net receipt of funds totaling 4.36 trillion yen, which is significantly higher than the 700 billion to 1.1 trillion yen estimated by money market brokerages, excluding intervention.

Technical Analysis

* Technical Breakout: USDJPY was traded lower following prior breakout below the previous support level 153.30. MACD which illustrate ongoing bearish momentum signal suggest the pair to further extend its downward momentum.

* Resistance and Targets: If the bearish momentum persists, there’s a strong likelihood that the price will potentially head towards 151.95. Conversely, if the price breach back above the level 153.30, a technical correction is expected and the price could head back towards the level 154.75.

Understand how technical analysis can help you in this trading opportunity.

Potential Risks

Moving ahead, traders are directing their attention to forthcoming US macroeconomic indicators, specifically the US Nonfarm Payrolls (NFP) report and ISM Services PMI data, scheduled for release on Friday. These data points are poised to significantly impact near-term USD price movements and could serve as a significant catalyst for the currency pair.

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Monitoring

Stay updated on US and Japan data, Fed and BoJ related updates and any shifts in the US Dollar’s strength by following PU Prime’s market insights and daily financial news.

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Disclaimer: Trading derivatives involves high risks, and market conditions can change rapidly. The content is for informational purposes only and should not be considered as financial advice. Traders should conduct their own research and consider risk management strategies.