The G20 summit took place in Bali, Indonesia, on November 2022…
Everything points to fall of USD/JPY
Information is not investment advice
The whole day the market sentiment has remained risk-off amid a stalemate over fiscal stimulus. The US economy needs it now, especially households and small businesses. However, officials continue discussing its amount and ways of spending it as upcoming elections increased tensions.
Elsewhere, new virus cases are steadily rising, forcing countries to impose stricter restrictions. All news concerning Covid-19 and vaccine tend to have a huge impact on the market. On the Brexit front – total uncertainty. As a result, investors poured their capital into safe-haven assets such as the USD and the JPY. It looks like the yen is outperforming.
The US core retail sales came out better than analysts expected, which helped the USD to rise briefly. However, USD/JPY has turned to the downside again. Let’s look at the charts.
On the daily chart, we can see the formation of the bearish – descending triangle pattern. The move below the key psychological mark of 105.00 will drive the pair down to the significant support of 104.50. USD/JPY has failed to cross it a few times, so we can expect the price to bounce off it briefly. The breakout below this level will drive the pair to the next support of 104.00. Resistance levels are 105.70 and 106.05.
Elsewhere, if we look at the 4-hour chart, we’ll notice the dead cross: the 50-period moving average has crossed the 200-period moving average upside down. In this timeframe, we can even set the closer support at 105.15. The move above it will open doors towards 105.00.
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