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USDJPY Technical Analysis – December-19-2023

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In today’s comprehensive USDJPY technical analysis, we will first scrutinize the price action of the currency pair. Then we will meticulously delve into the fundamental analysis pertaining to the trading instrument.

USDJPY Technical Analysis

FxNews – The USDJPY currency pair has recently rose to the upper boundary of the bearish flag pattern. This crucial level is reinforced by the 38.2% Fibonacci resistance and the presence of the Ichimoku cloud. Current technical indicators are signaling bullish tendencies. Notably, the Awesome Oscillator is moving above its signal line. Concurrently, the Relative Strength Index (RSI) is maintaining a position above the 50 mark, both indicators suggesting upward momentum.

Despite these signals, the overall technical analysis for USDJPY stays bearish as the pair trades below the Ichimoku cloud. Should the bearish trend persist, USDJPY might face a further decline, aiming for the 23.6% Fibonacci resistance level.

Conversely, if the bulls manage to push the price above the Ichimoku cloud, it would challenge the current bearish outlook. For a bullish trend to be confirmed, it is essential for the price to stabilize above this resistance level. This event will indicate a significant shift in market sentiment.

USDJPY Technical Analysis - December-19-2023

USDJPY Technical Analysis – 4H Chart

JGB Yield Hits Low as BoJ Maintains Policy: A Fundamental Analysis

Reuters – The 10-year Japanese Government Bond (JGB) yield dropped to 0.6%, its lowest point since mid-August. This decline came after the Bank of Japan’s decision to maintain its ultra-easy monetary policy in its final meeting of 2023. The central bank also committed to keeping interest rates low, but did not provide any hints about potential policy changes in the coming year.

Governor Ueda expressed that it is currently difficult to predict with certainty how the central bank will transition away from this ultra-loose policy. The future remains highly uncertain, and the Bank of Japan is still trying to achieve its inflation targets in a sustainable and stable manner. Despite these uncertainties, many investors are speculating that the Bank of Japan might adjust its policy in 2024. April is currently seen as the most probable time for this potential policy shift.

  • 19 December 2023
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