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98.090

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4564.93

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157.009

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      Short Interest Hits Fresh Highs with USD/JPY Breaching the 160 Level

      Summary:

      The Federal Reserve decided to keep interest rates unchanged, in line with widespread expectations, and this meeting marked Jerome Powell’s final one as chair.

      Buy USDJPY
      End Time
      CLOSED

      160.380

      ENTRY

      163.000

      TGT

      158.000

      SL

      157.009 -0.029 -0.02%

      2380

      Points

      Loss

      158.000

      SL

      157.995

      CLOSING

      160.380

      ENTRY

      163.000

      TGT

      Fundamentals
      In its latest decision, the Bank of Japan kept interest rates unchanged at 0.75%. Although Governor Kazuo Ueda indicated that he would not rule out raising rates to tackle broader inflation, the market reaction was muted. With headline inflation currently at around 1.5% and core inflation at 2.4%, real interest rates remain in negative territory, which is one of the key factors keeping the yen under sustained pressure. The market widely believes that this state of negative real interest rates is unlikely to change in the short term, thereby reinforcing expectations of a weak yen. Intervention remains the biggest potential variable in the yen’s current trajectory. Although the Japanese Ministry of Finance has issued repeated warnings, as previous tough rhetoric has not been accompanied by concrete action, the market’s sensitivity to ‘verbal intervention’ has clearly diminished. At the same time, given the significant interest rate differential that still exists between Japan and other major economies, it remains doubtful whether relying solely on intervention can produce lasting results.
      Monetary policy in the United States is also at a critical juncture. At its latest meeting, the Federal Reserve decided to keep the federal funds rate in the 3.50% to 3.75% range, but the vote was unusually split—with eight officials in favour of maintaining the status quo and four against, marking the widest divergence since 1992. Three of those opposed to retaining any dovish tone in the policy statement, whilst one advocated an immediate 25-basis-point cut. This divergence reflects the complexity of the current policy environment. On the one hand, inflation remains stubborn, and recent high energy prices—driven by the situation in the Middle East—have further heightened inflationary risks; on the other hand, high energy costs may also dampen economic growth, leaving policymakers facing a dilemma between ‘fighting inflation’ and ‘sustaining growth’.
      Technical Analysis
      On the daily chart, the USD/JPY pair shows the Bollinger Bands narrowing, with moving averages levelling off. The price has broken through the upper Bollinger Band with a strong bullish candle, and the MACD has formed a golden cross, indicating an overall upward trend. The RSI stands at 62, indicating that market sentiment is predominantly bullish. On the four-hour chart, the Bollinger Bands are widening upwards, moving averages are diverging upwards, and the MACD fast and slow lines are trading above the zero line. The bullish trend remains intact, and there is a high probability of a rise to the round figure of 161. With the RSI at 70, the market is characterised by optimism. The recommended strategy is to buy on dips.
      Short Interest Hits Fresh Highs with USD/JPY Breaching the 160 Level_1
      Short Interest Hits Fresh Highs with USD/JPY Breaching the 160 Level_2
      Trading Recommendation
      Trading Direction: Buy
      Entry Price: 160.3
      Target Price: 163
      Stop-loss: 158
      Support Levels: 158, 157, 155
      Resistance Levels: 161, 162, 163
      Risk Warnings and Investment Disclaimers
      You understand and acknowledge that there is a high degree of risk involved in trading with strategies. Following any strategies or investment methodologies is the potential for loss. The content on the site is being provided by our contributors and analysts for information purposes only. You alone are solely responsible for determining whether any trading assets, or securities, or strategy, or any other product is suitable for you based on your investment objectives and financial situation.

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      Tank

      Analysts

      20 years of trading experience, specializing in naked price action analysis, Elliott Wave Theory, and Chan Theory. Has conducted in-depth research on forex, stocks, and cryptocurrencies. Achieved a tenfold profit during the 2005 bull market and doubled profits within one month of entering the crypto market in 2015. Adheres to the trading philosophy: "Trend is king; focus on the big picture, act on

      Rank

      1

      Articless

      691

      Win Rate

      74.12%

      P/L Ratio

      0.67

      Focus on

      XAUUSD, GBPUSD

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