Daily Analysis USDJPY - 28 July 2023

The US Gross Domestic Product (GDP) unexpectedly expanded at a higher rate of 2.4% compared to the previous quarter's 2.0%. Durable Goods Orders data for June also rose significantly by 4.7% surpassing expectations. Weekly jobless claims for July 21 remained below expectations, indicating a strong US economic outlook. The Federal Reserve may announce one more interest rate hike in September due to tight labor market conditions and the economy's resilience.

The Bank of Japan (BOJ) decided to maintain its benchmark policy rate at -0.1%. Additionally, the central bank announced its intention to allow 10-year government bond yields to fluctuate within a range of approximately plus or minus 0.5%. However, the BOJ plans to implement yield curve control with greater flexibility, viewing the upper and lower bounds of the range as references rather than strict limits during market operations.

USDJPY retraced towards the support area around the 138-137 level and rebounded while the dollar was still strong. The bearish channel has been tested twice around the 138-137 support area. A breakout may push the price toward the 135.00 support level.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
142.00	141.20	140.22	138.70	137.70	135.50