On Wednesday, the USD/JPY exchange rate experienced increased demand for the second day in a row. As of this writing, it is trading just shy of that 145.20 zone. This net short position is not far from a two-week high, set in the first half of the European session today. Skepticism remains in the air over global trade, but traders are not letting the protectionist fuel their flight from the safe-haven Japanese yen. Consequently, they are turning into US dollar’s favor.
In fact on Tuesday, the USD/JPY pair reached its highest level in two weeks. This increase indicates a heightened premium for the dollar as global financial markets increasingly undergo structural changes. A recent ruling by a federal appeals court has thrown that into doubt. This latest development is driving investor sentiment and influencing the financial markets sentiment bias and the dynamics of the USD/JPY pair. In diabetes, buyers have remained in control, driving the pair to new highs.
According to market analysts, the USD/JPY pair’s intermediate hurdle is seen at the levels of 145.60 – 145.65. Should the bullish sentiment continue, the currency pair might build its positive advance. It has potential to hit up to major resistance from 146.25 to 146.30, the same as the swing high on May 29.
The USD/JPY cross has formed an immediate support base near the crucial support of 144.30. That level is represented by the 200-period Simple Moving Average (SMA) on the four-hour chart above. An important support area lies in the range of 143.60 to 143.50. Forecasters expect that once the pair falls under the mental level of 145.00, dip-buyers will probably come rushing into the market. These new buyers will need to support prices and keep declines contained around the 144.30 area.
Traders will be especially focused on a big figure support level at 144.00. A breach of this magnitude would seriously threaten that hopeful horizon. This move would be widely bullish trader-unfriendly and would pose further obstacles to any bullish momentum. Conversely, if the USD/JPY pair manages to maintain acceptance above both the 200-period SMA and the 145.00 mark, it would provide a favorable environment for bullish traders.
The next target for bullish sentiment is up at the big, round number of 146.00. Demand overwhelmed supply and buying interest is still extremely high. If the USD/JPY price breaks the 145.30 resistance zone, it’ll validate the bullish structure and likely propel the USD/JPY pair above the minor resistance level at 145.60 to 145.65.
Optimism continues to drive buying activity in the USD/JPY. Future movements will be heavily determined by outside factors such as changing market sentiment, future legal rulings, and changing trade dynamics. Traders need to be vigilant and increasingly aware of these developments. As the global currency trading landscape continues to change, their watchful eye has become increasingly necessary.