TECHNICAL ANALYSIS
On the daily chart, we can see that the USDJPY pair is now getting close to the 150.00 handle, which is what many market participants have been targeting, and it’s also near the upper bound of the rising channel. We might finally see a decent correction from those levels, but the market will need a good catalyst to kick off the pullback. As long as the US data remains strong and the Japanese data doesn’t show a pick-up in wages, we might see further upside in the bigger picture. On the 1 hour chart, we can see that in case of a pullback, the buyers are likely to lean on the previous resistance turned support around the 148.45 level where there’s also the confluence with the 38.2% Fibonacci retracement level and the 4-hour red 21 moving average. In case of a break lower, the sellers will pile in even more targeting the lower bound of the wedge.
FUNDAMENTAL ANALYSIS
On Thursday, we will have another US Jobless Claims data which keeps on showing strength in the labour market maintaining the hawkish pricing in interest rates expectations. Finally, on Friday, we will get the latest US PCE data and a few Japanese economic releases such as the Tokyo CPI, the Unemployment Rate and Retail Sales.
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