USD/JPY consolidated this week, in absence of recent catalyst as markets await US CPI subsequent Tuesday. Pair was final at 14784 ranges, OCBC’s FX analysts Frances Cheung and Christopher Wong be aware.
Political uncertainty may be supportive of the pair
“On tariff growth, commerce negotiator Akazawa mentioned that US agreed to finish the so-called stacking on common tariffs and scale back tariffs on automobiles. US may also payback tariffs that had been overpaid as a consequence of stacking. Each day momentum is gentle bearish although decline in RSI moderated. Close to time period consolidation; however retain bias nonetheless to promote rallies.”
“Help right here at 147.10 ranges (38.2% fibo), 145.80/146 ranges (50, 100 DMAs). Resistance at 147.90 (21 DMA), 149.40/50 ranges (200 DMA, 50% fibo retracement of 2025 excessive to low). Carry commerce attract is considerably lowered as softer US knowledge builds the case for Fed to renew charge minimize cycle quickly whereas BoJ is prone to proceed to hike charge in the end.”
“To some extent, political uncertainty (referring to PM Ishiba’s political profession/ LDP management) and credit standing issues (depending on fiscal well being) may be supportive of the pair, however ‘promote USD’ momentum and narrowing UST-JGB yield differentials also can counter.”
