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USD/JPY Declined Massively and Currently Exposed to Further Decline

January 13, 2023 Financial Market, Technical Analysis

Key Take-Aways

  • A new fall in USD/JPY began at the 134.80 resistance.
  • On the 4-hours chart, it fell below a significant bullish trend line with support located close to 132.10.
  • The resistance level of 1.0750 was broken by the EUR/USD.
  • The UK GDP may decline by 0.2% in November 2022 (MoM), from a previous +0.5%.

Technical Analysis of USD/JPY

Against the Japanese Yen, the US Dollar was unable to overcome the 134.80 barrier level once more. The USD/JPY pair launched a new downward trend and traded beneath the 133.50 support.

The pair continued to fall below the 132.50 level, the 100 simple moving average (red, 4-hours), and the 200 simple moving average, according to the 4-hours chart.

On the same chart, the pair also dropped below a significant bullish trend line with support close to 132.10. The upward movement from the 129.50 swing low to 134.77 high was clearly broken below the 61.8% Fib retracement level.

At 129.20, there is a significant support for the downside. The area around 128.80 is the next significant support. The pair may move lower if the downside breaks through the region of 128.80.

Near the 127.50 mark, there is the next significant support. Any additional losses might pave the way for a move in the direction of the 126.00 support area.

An initial resistance on the upswing is located close to the 131.50 mark. Near 132.000 may serve as the next significant resistance. A definite move above the 132.00 resistance could signal the beginning of a continuous rise. The USD/JPY exchange rate might possibly approach 132.50 in the scenario described. The pair might increase toward the 133.20 level in the scenario described.

Regarding EUR/USD, the pair picked up steam and managed to break through the 1.0750 resistance area, paving the way for more gains.

Economic News to Trade Today

  • Forecast for UK Industrial Production in November 2022 (MoM): -0.3% vs. 0%
  • UK GDP for November 2022 (MoM) is forecast to be -0.2%, down from the prior +0.5%.
Author:
Amogo Solomon is a Broker-Dealer/Market Research analyst and writer in ACT Brokers with a background in Computer Science, Data Analytics, and Forex Broker Dealing. He specializes in Forex Dealing, markets Analysis, Currency research, forex fundamental and technical analysis, and Monitoring of Forex trends, Stocks, Equities, Cryptos, and Commodities. He possesses strong technical and analytical skills and is well known for his entertaining and informative analysis of the global economy, fiat currency, commodities, Stocks, Indexes, Futures, and Options markets. He held a Bachelor's degree in Computer Science and Nanodegree in Programming for Data Science Enterprise.

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