Published on Mar 24, 2023

Daily Analysis For USD/JPY 24-03-2023

USD/JPY Analysis

Economic Events and Scenario for USD/JPY

Economic Events: -

GMT	Event	Impact	Currency
0:01	(Ireland) Consumer Confidence	Low	EUR
0:01	(United Kingdom) Gfk Consumer Confidence	High	GBP
0:30	(Japan) Jibun Bank Services PMI	Medium	JPY
0:30	(Japan) Jibun Bank Composite PMI	Low	JPY
0:30	(Japan) Jibun Bank Manufacturing PMI	Medium	JPY
3:35	(Japan) 3-Month Bill Auction	Low	JPY
5:30	(Netherlands) GDP Growth Rate QoQ	Medium	EUR
5:30	(Netherlands) GDP Growth Rate YoY	Medium	EUR
6:00	(Finland) Import Prices YoY	Low	EUR
6:00	(Finland) PPI YoY	Low	EUR
6:00	(Finland) Export Prices YoY	Low	EUR
7:00	(United Kingdom) Retail Sales MoM	High	GBP
7:00	(United Kingdom) Retail Sales YoY	High	GBP
7:00	(United Kingdom) Retail Sales ex Fuel MoM	High	GBP
7:00	(United Kingdom) Retail Sales ex Fuel YoY	High	GBP
8:00	(European Union) European Council Meeting	Medium	EUR
8:00	(Spain) PPI YoY	Low	EUR
8:00	(Spain) GDP Growth Rate QoQ	Medium	EUR
8:00	(Spain) GDP Growth Rate YoY	Medium	EUR
8:15	(France) S&P Global Composite PMI	Low	EUR
8:15	(France) S&P Global Services PMI	Medium	EUR
8:15	(France) S&P Global Manufacturing PMI	Medium	EUR
8:30	(Germany) S&P Global Composite PMI	Low	EUR
8:30	(Germany) S&P Global Services PMI	High	EUR
8:30	(Germany) S&P Global Manufacturing PMI	High	EUR
9:00	(Euro Area) S&P Global Composite PMI	Low	EUR
9:00	(Euro Area) S&P Global Manufacturing PMI	High	EUR
9:00	(Euro Area) S&P Global Services PMI	High	EUR
9:30	(Slovenia) Business Confidence	Low	EUR
9:30	(Slovenia) Tourist Arrivals YoY	Low	EUR
9:30	(United Kingdom) S&P Global/CIPS Composite PMI	Low	GBP
9:30	(United Kingdom) S&P Global/CIPS Manufacturing PMI	High	GBP
9:30	(United Kingdom) S&P Global/CIPS UK Services PMI	High	GBP
9:30	(Germany) Bundesbank Nagel Speech	Low	EUR
11:00	(Luxembourg) Current Account	Low	EUR
11:00	(Netherlands) Current Account	Low	EUR
12:30	(Canada) Wholesale Sales MoM	Low	CAD
12:30	(Canada) Retail Sales YoY	High	CAD
12:30	(Canada) Retail Sales Ex Autos MoM	High	CAD
12:30	(Canada) Retail Sales MoM	High	CAD
12:30	(Canada) Manufacturing Sales MoM	Low	CAD
12:30	(United States) Non Defense Goods Orders Ex Air	Low	USD
12:30	(United States) Durable Goods Orders ex Defense MoM	High	USD
12:30	(United States) Durable Goods Orders MoM	High	USD
12:30	(United States) Durable Goods Orders Ex Transp MoM	High	USD
13:30	(United States) Fed Bullard Speech	Medium	USD
13:45	(United States) S&P Global Composite PMI	Medium	USD
13:45	(United States) S&P Global Services PMI	High	USD
13:45	(United States) S&P Global Manufacturing PMI	High	USD
14:00	(Belgium) Business Confidence	Low	EUR
16:00	(United Kingdom) BoE L Mann Speech	Medium	GBP
17:00	(United States) Baker Hughes Oil Rig Count	Low	USD
17:00	(United States) Baker Hughes Total Rig Count	Low	USD

Today's Scenario: - The USD/JPY pair has rebounded from six-week lows at 130.18, but continues to experience strong selling pressure in early Friday trading. This can be attributed to a negative risk environment and mixed inflation data from Japan. However, the pair is being supported by a broad-based rebound in the US Dollar, as traders anticipate the release of US PMIs.

It is important to note that market conditions can change quickly, and unexpected events can impact the direction of the USD/JPY pair. Therefore, traders should remain vigilant and closely monitor market developments.

Buy Scenario: - On the Buying side, if the USD/JPY pair manages to recover, it may initially face resistance at the 50-day moving average (DMA) hurdle of 132.60. However, the bulls may face a tough challenge at a horizontal area consisting of multiple tops marked since February 17, which is located close to 135.20.

If the pair manages to break past the 135.20 resistance level, there is a possibility of reaching a fresh monthly high, which is currently around 137.90.

It is important to note that market conditions can be unpredictable, and the direction of the USD/JPY pair can change rapidly. Therefore, traders should remain cautious and closely monitor market developments. Till we did not advise to buy in USD/JPY.

Sell Scenario: - The USD/JPY pair is currently trading near 130.60, after hitting a 1.5-month low, amid a three-day downtrend on early Friday. The Yen pair's sellers are attacking the support line that has been in place since early January, while extending the mid-week pullback from the 50-day moving average (DMA).

The bearish MACD signals and the pair's inability to cross the 50-DMA, currently at around 132.60, are also weighing on the quote. This suggests a potential downside break of the immediate support line, located near 130.50 at the latest.

If the pair does break the support line, the bears may test the 130.00 round figure, as well as multiple levels marked in February near 129.30 and 128.00, before potentially directing the pair to the yearly low of 127.21.

It is important to note, however, that if the USD/JPY pair sustains weakness below 127.21, it could become vulnerable to testing the 61.8% Fibonacci Expansion (FE) of its moves between October 2022 and March 2023, which is near 122.50.

As market conditions can be unpredictable, traders should remain cautious and closely monitor market developments. Till we did not advise to sell the position in USD/JPY.

Support and Resistance Level: -