FUNDAMENTAL ANALYSIS ON USDJPY
Investing.com – The dollar gained ground on Friday as solid data on U.S. retail sales and producer prices bolstered expectations that the Federal Reserve could raise interest rates in the coming months.
U.S. retail sales rose 0.6% in September after declining 0.2% the previous month, data from the Commerce Department showed Friday.
Another report showing that U.S. producer prices picked up broadly last month added to the view that the economy is on a strong enough footing for a rate hike by the Fed before the year’s end.
The reports came after the minutes of the Fed’s September meeting, published on Wednesday, showed several officials believed it would be appropriate to raise interest rates “relatively soon” if the economy continued to improve.
The U.S. central bank raised rates for the first time in almost a decade in December, but rates have remained on hold since then amid concerns over sluggish inflation.
The Fed’s next meeting is in November, but a rate hike ahead of the presidential election is seen as unlikely.
Expectations for higher rates typically boost the dollar by making it more attractive to yield seeking investors.
Investors currently price a 64% chance of a rate hike at the Fed’s December meeting; according to federal funds futures tracked Investing.com’s Fed Rate Monitor Tool.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.56% at 98.08 late Friday. For the week, the index gained 1.4%.

USDJPY DAILY

PRICE IS JUST BELOW MM4 PIVOT AND AT THE TOP OF THE RANGE,

USDJPY H4

PRICE IS JUST BELOW WM3 PIVOT AND WE SEE HIGHER HIGHS AND HIGHER LOWS. I EXPECT PRICE TO RETRACE BACK TO WPP OR WM2 BEFORE MAKING A HIGHER HIGH. 21 EMA IS ABOVE THE 55. I EXPECT ANOTHER FALL AT LEAST TO THE 61.8 BEFORE RETURNING TO ITS BULLISH TREND, SO I AM LOOKING TO BUY AT SUPPORT.

USDJPYH1-3

WE ARE AT DM 3 PIVOT WITH PRICE AT 104.31. HENCE CURRENT PRICE COULD BE TARGETING DR2 PIVOT FOR RESISTANCE BEFORE A PULL BACK.

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