- The price of USD/JPI could fall at any time if it remains below the downtrend line.
- FOMC should bring high volatility.
- The hawkish speech should lift the dollar.
The USD/JPY price has ended its minor pullback and is now fighting hard to post a meaningful recovery. The pair is trading at 145.81 at the time of writing, well above yesterday’s low of 144.72.
–Are you interested in learning more about ECN brokers? Check out our detailed guide-
Basically, the dollar seems determined to take full control as the US reported higher inflation in November. The Consumer Price Index rose 0.1% versus an estimate of 0.0%, while the Core CPI posted a 0.3% rise, in line with expectations.
Today, Japan’s Tankan Manufacturing Index and Tankan Non-Manufacturing Index were better than expected, but the JPI remains sluggish in the short term.
Later, the US will release PPI, which is expected to report a 0.0% increase after a 0.5% decline in the previous reporting period, as well as the Core PPI indicator.
However, the most important event of the week is the FOMC rate decision. The Fed is expected to keep the federal funds rate at 5.50%.
However, the FOMC economic projections, the FOMC statement, and the FOMC press conference are high-impact events. A hawkish speech about higher US inflation could boost the dollar.
USD/JPI price technical analysis: close to key resistance
Technically, the currency pair has recovered within an ascending channel pattern. It failed to reach the downtrend line. It has now escaped from this chart formation. The price failed to stay above the 38.2% retracement level (146.31), signaling exhausted buyers.
–Are you interested in learning more about day trading brokers? Check out our detailed guide-
It has now turned to the upside after only a false breakout was registered with a major breakout below the psychological level of 145.00. However, the price could fall again if it remains below the downtrend line. Only the removal of this dynamic resistance can herald more growth. On the other hand, a broader move lower could be triggered by a new lower low.
Do you want to trade Forex now? Invest in eToro!
68% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing money.
