Daily Analysis USDJPY - 20 Mar 2023
Fundamental Outlook: On Monday, a high-ranking official in Japan's government made a statement indicating that the country's banking system is secure and not vulnerable to the negative effects of issues currently affecting the banking sectors of the United States and Europe. The official's intention was to calm any concerns in the markets about a possible spread of problems to Japan.
Technical Analysis: Based on technical analysis, the currency pair has been experiencing a downtrend and recently broke below its previous uptrend line, resulting in a drop below the 50-day moving average (indicated by the purple line). If the price fails to hold this support level, we may witness an increase in selling pressure. As such, traders should closely monitor the 130.55 level for a possible sell-off. Conversely, the 132.60 level may serve as a resistance level on the upside. If the price manages to break above this level, it could attract buyers, potentially pushing the price higher and exceeding the 8-day exponential moving average.
Support: 130.55 – 129.85 – 128.35 Resistance: 132.60 – 133.10 – 134.00