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USD/JPY Technical Analysis: US Inflation Figures – 12 April 2022

Amidst a sharp upward momentum, the price of the US dollar against the Japanese yen (USD/JPY) currency pair is receiving the announcement of US inflation figures today. The currency pair is stable around the 125.55 resistance level at the time of writing the analysis. At the beginning of this week’s trading, it moved towards the 125.77 resistance level, the highest for the currency pair in six years. US inflation figures still support expectations of more chances to raise US interest rates throughout 2022.

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Federal Reserve officials raised US interest rates by a quarter point last month to a target range of 0.25% to 0.5% and indicated they expect to raise rates to 1.9% by the end of 2022 and 2.8% by the end of next year, according to their median forecast. Since then, officials have said they are open to moving faster if necessary, to cool the biggest inflation in four decades, including by raising half a point at their May 3-4 meeting. The minutes of the March Fed meeting showed that many had preferred to go that far last month but had opted for a cautious quarter-point increase in light of the Russian invasion of Ukraine and were open to a half-point rate hike at one point or more meetings. In the future.

According to the technical analysis of the pair: The general trend of the USD/JPY currency pair is still bullish. Investors do not care about the arrival of technical indicators on the impact of these gains to strong overbought levels. The path is completed, as the discrepancy in economic performance and the future of monetary policy is what Between Japan and the United States is still in favor of a stronger US dollar. The closest targets for the bulls are currently 126.20 and 127.00, bearing in mind that stopping the dollar’s momentum may mean activating strong profit-taking.

According to the performance on the daily chart, bears move the dollar-yen pair below 120.00 to start changing its current upward direction.

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