USDJPY Holding Steady at 148.50 While Eyeing 152.00 Targets

Traders' Opinions

Economic

Summary:

The Japanese Yen (JPY) remained stable against the US Dollar (USD) on Tuesday, as geopolitical tensions and intervention concerns offset fading expectations for further rate hikes by the Bank of Japan (BoJ).

BUY USDJPY

Close Time

CLOSED

148.000

Entry Price

152.000

146.000

156.302 -1.112 -0.71%

109.7

Pips

Profit

146.000

149.097

Exit Price

148.000

Entry Price

152.000

The Japanese Yen (JPY) demonstrated remarkable stability against the US Dollar (USD) on Tuesday, holding steady for the second consecutive day. This resilience comes amid growing concerns about a sustained bullish trend for the JPY, with overnight remarks from Japanese officials intensifying speculation about potential currency intervention. As geopolitical tensions escalate in the Middle East, the Yen’s safe-haven appeal has gained traction, further supporting its position against the Dollar.

As the trading day unfolded, the USD showed slight declines, creating additional downward pressure on the USD/JPY pair. The interplay between these currencies reflects broader market sentiments, particularly as traders digest recent developments in global geopolitics and monetary policy shifts. With the upcoming Federal Open Market Committee (FOMC) meeting minutes on Wednesday and key US inflation data scheduled for Thursday and Friday, market participants are keenly awaiting insights that could influence future policy directions.

Despite this relatively favorable backdrop for the Yen, the prevailing sentiment among JPY bulls remains cautious. The fading odds of another interest rate hike by the Bank of Japan (BoJ) in 2024 have tempered enthusiasm, prompting investors to reassess their positions. Concurrently, expectations for aggressive policy easing by the Federal Reserve (Fed) have also diminished, which has contributed to a more stable outlook for the USD. The balancing act between these central banks will be crucial in shaping currency trajectories in the near term.

Technical Analysis

From a technical perspective, the USD/JPY pair has encountered significant resistance at the 148.53 level, resulting in a slight bearish bias. This resistance point is critical, as a breach could signal a continuation of the bullish trend that has dominated in recent months.We are closely monitoring for any positive momentum that might assist in surpassing this barrier. Should the USD/JPY successfully break above this threshold, subsequent targets are projected at 150.00 and 152.00, reflecting a continuation of bullish sentiments.

Conversely, should the pair experience a decline and break below the 147.25 level, the market could see increased selling pressure, propelling the USD/JPY towards the 145.36 region in the near term. For today, the expected trading range for USD/JPY is between 146.80 (support) and 148.50 (resistance).

TRADE RECOMMENDATION

BUY USDJPY

ENTRY PRICE: 148.00

STOP LOSS: 146.00

TAKE PROFIT: 152.00

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

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Winkelmann

Commodity

Summary:

Short-term markets have reduced bets on further drastic interest rate cuts, resulting in a slight retreat in gold prices, with rising risks of further correction.

SELL XAUUSD

Close Time

CLOSED

2644.41

Entry Price

2600.00

2672.00

2623.41 +28.97 +1.12%

300.8

Pips

Profit

2600.00

2614.33

Exit Price

2644.41

Entry Price

2672.00

Fundamentals

Over recent times, buoyed by geopolitical tensions and optimistic expectations of central bank rate cuts, gold has seen impressive gains, reaching historical peaks repeatedly. However, the September US non-farm payrolls report revealed an unexpected addition of 254,000 jobs, indicating resilience in the job market, and dampening the market's hopes for continued aggressive rate cuts by the Fed. Consequently, the US Dollar Index experienced its strongest rally in months.

Moreover, Fed officials generally supported a cautious approach to cutting rates, prompting markets to pare back bets on another major rate cut. In the short term, gold faces the threat of further correction amidst the rebound in the dollar and US Treasury yields. Nonetheless, given persistent safe-haven demand driven by geopolitical uncertainties and the upcoming US election, coupled with prospects for further central bank easing, gold retains significant upside potential in the medium to long term, with downside likely to be limited.

Technical Analysis

Cooling Expectations for Aggressive Rate Cuts Signal Imminent Correction in Gold Prices_1

Regarding the 4-hour chart, XAUUSD has been oscillating near record highs recently, with momentum visibly weakening. Despite escalated Middle Eastern conflicts, gold failed to set new highs, instead experiencing a pullback, signaling potential profit-taking that could lead to price weakness. A breakdown below $2635 could precipitate a rapid decline towards the $2600 mark, potentially lower. Technically, signs of overbought conditions suggest an imminent correction, with buying opportunities upon dips recommended.

Chasing the uptrend is not recommended. Try to sell when XAUUSD reaches $2640 or drops below $2630. The target should be at $2600, and the stop-loss should stay above $2660.

Trading Recommendations

Trading direction: Sell

Entry price: 2640

Target price: 2600

Stop loss: 2672

Support: 2600/2635

Resistance: 2660/2670

Risk Warnings and Disclaimers

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Manuel

Economic

Central Bank

Summary:

This pattern often suggests that selling momentum is weakening, indicating a possible bullish reversal from this support zone.

BUY GBPUSD

Close Time

CLOSED

1.30930

Entry Price

1.32700

1.30000

1.25573 +0.00575 +0.46%

93.0

Pips

Loss

1.30000

1.29996

Exit Price

1.30930

Entry Price

1.32700

Fundamentals

The UK's Gross Domestic Product (GDP) report for the second quarter delivered weaker-than-expected results. The economy expanded by just 0.5% quarter-over-quarter, slightly below both the anticipated rate and the previous quarter’s growth of 0.6%. On a year-over-year basis, GDP rose by 0.7%, again missing the forecast of 0.9% growth.

Bank of England (BoE) Governor Andrew Bailey has hinted at a potential shift toward a more aggressive stance on interest rate cuts, citing manageable inflation levels. His remarks have fueled speculation that the central bank could lower rates by a quarter-point in November, with the possibility of another cut in December.

Market participants are increasingly expecting the BoE to announce a rate reduction in its upcoming meetings, particularly as inflation in the UK’s services sector remains persistent. Annual services inflation, a key indicator closely tracked by the BoE, climbed to 5.6% in August, up from 5.2% in July. This has heightened the cautious sentiment surrounding the BoE's interest rate policy.

Bailey’s recent comments during the European trading session on Tuesday suggested that while the BoE will continue its easing cycle, it is likely to proceed at a cautious pace to avoid any drastic economic shocks.

From an economic standpoint, the S&P Global/CIPS UK Purchasing Managers’ Index (PMI) for September showed a slight decline, although it remained above the critical 50.0 level, indicating continued expansion. The PMI report indicated that private sector business activity fell to 52.9 from 53.8 in August, as both the manufacturing and services sectors experienced a sharper-than-expected slowdown.

Meanwhile, the U.S. Bureau of Labor Statistics revealed that nonfarm payrolls increased by 254,000 jobs in September, following an upward revision of 72,000 jobs over the previous two months. The unemployment rate edged down to 4.1%, reflecting sustained strength in the labor market.

Further evidence of robust demand for workers and low layoff rates supports the view that the job market remains solid, easing concerns about a potential cooling of the economy.

October's employment report is expected to reflect the effects of last month’s Boeing strike, which involved around 33,000 factory workers. Another labor event, the short-lived U.S. dockworkers' strike, lasted just three days and is unlikely to significantly impact payroll data.

Additionally, the September ADP employment change report surprised to the upside, adding 143,000 jobs against a forecast of 120,000. This data precedes the highly anticipated Nonfarm Payrolls (NFP) report, which investors are closely watching for confirmation of labor market trends.

The market’s sentiment aligns with the Federal Reserve's projections, with the CME FedWatch Tool indicating a 93.5% probability of a 25 basis point rate cut in November, while only 6.6% of investors expect a larger cut of 50 basis points. Emerging Divergence Points to Bullish Potential_1

Emerging Divergence Points to Bullish Potential_1

Technical Analysis

The GBP/USD pair has reached a local low of 1.3060 in the most recent session, a level not seen for a month. At the same time, the Relative Strength Index (RSI) has dropped to new lows, signaling a potential bullish divergence. This occurs when the RSI falls more sharply than the price itself, despite the current price being higher than the previous low. This pattern often suggests that selling momentum is weakening, indicating a possible bullish reversal from this support zone.

Both the 100- and 200-period moving averages remain above the current price, without showing signs of a bearish crossover. This suggests that bulls still hold some control, as no new lower lows have been established. For a potential take-profit target, we can utilize the Fibonacci expansion tool, which aligns the target zone with the 100-period moving average, providing a potential upward objective. However, if the price breaks below the key support level of 1.3000, further downside pressure could emerge.

Trading Recommendations

Trading direction: Buy

Entry price: 1.3090

Target price: 1.3270

Stop loss: 1.3000

Validity: Oct 17, 2024 15:00:00

Risk Warnings and Disclaimers

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Manuel

Central Bank

Economic

Summary:

The recent low, near 1.077, aligns with the 0.618 and 0.50 Fibonacci retracement levels, suggesting this area could serve as a retracement zone with bullish targets in play.

BUY EURUSD

Close Time

CLOSED

1.09498

Entry Price

1.10800

1.09100

1.04249 +0.00643 +0.62%

39.8

Pips

Loss

1.09100

1.09083

Exit Price

1.09498

Entry Price

1.10800

Fundamentals

The U.S. Bureau of Labor Statistics reported that nonfarm payrolls grew by 254,000 jobs in September, following a 72,000-job upward revision for the previous two months. The unemployment rate dropped to 4.1%, suggesting ongoing strength in the labor market.

Early indications showing strong demand for workers and low layoff levels, further suggest that the job market remains resilient, easing concerns about a potential slowdown.

October’s employment report will capture the impact of last month's Boeing strike, which involved approximately 33,000 factory workers. Another key labor event, the brief U.S. dockworkers’ strike, ended after three days and is unlikely to directly affect payroll figures.

In September, the ADP employment change report exceeded expectations, adding 143,000 new jobs versus a forecast of 120,000. This comes ahead of the official Nonfarm Payrolls (NFP) data, which investors are closely monitoring for confirmation of this labor market strength.

Market sentiment aligns with the Federal Reserve’s projections, with the CME FedWatch Tool showing a 93.5% probability of a 25 basis point rate cut in November. Only 6.6% of market participants expect a more significant reduction of 50 basis points.

The Eurozone's economic outlook has been dampened by weaker-than-expected inflation data. The Harmonized Index of Consumer Prices (HICP) rose by 1.8% year-on-year in September, missing forecasts of 1.9% and down from the 2.2% increase in August. Core inflation also declined slightly, registering at 2.7% compared to 2.8% in the previous month.

These numbers indicate that overall inflation has now dipped below the European Central Bank’s (ECB) 2.0% target, increasing the likelihood of additional rate cuts by the ECB. Such a move could result in capital outflows and weaken the Euro.

ECB policymakers favoring further monetary easing are preparing to advocate for another rate cut in the coming months, following a series of disappointing economic reports. However, this push may face resistance from more conservative members of the governing council.

Initially, officials were not expecting another rate cut during the October 17 meeting, as borrowing costs had already been lowered. This view was supported by sluggish growth projections and the belief that inflation would continue to decline gradually.

However, ongoing weak business activity across the Eurozone, declining confidence in Germany, and a notable slowdown in wage growth have bolstered the argument for further easing. Policymakers with a "dovish" stance are increasingly advocating for more stimulus, and recent economic challenges have intensified this momentum. Bullish Rebound From Key Support EURUSD Eyes Higher Levels_1

Bullish Rebound From Key Support EURUSD Eyes Higher Levels_1

Technical Analysis

The EUR/USD temporarily dipped below the 1.100 level and appears to be forming a significant support zone. The recent low, near 1.077, aligns with the 0.618 and 0.50 Fibonacci retracement levels, suggesting this area could serve as a retracement zone with bullish targets in play. The key resistance remains at 1.1200, a level that has been tested three times recently.

The 100- and 200-period moving averages are positioned above 1.1090, and their proximity could indicate a potential crossover after a pullback. If the price respects the downtrend line, there could be an upward move toward the 0.50 Fibonacci retracement level, offering a bullish target. Conversely, a break below 1.088 could pave the way for more significant declines.

Trading Recommendations

Trading direction: Buy

Entry price: 1.0950

Target price: 1.1080

Stop loss: 1.0910

Validity: Oct 17, 2024 15:00:00

Risk Warnings and Disclaimers

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Eva Chen

Economic

Commodity

Summary:

Tensions in the Middle East have pushed WTI crude prices higher. Currently, the market's focus on the conflict has not dissipated, and risk sentiment remains tilted toward the upside.

BUY WTI

Close Time

CLOSED

72.499

Entry Price

80.000

66.000

69.447 +0.305 +0.44%

88.8

Pips

Loss

66.000

71.611

Exit Price

72.499

Entry Price

80.000

Fundamentals

Rising tensions in the Middle East have sparked concerns about potential supply disruptions, leading to a surge in oil prices. Israeli Prime Minister Netanyahu has confirmed he is considering an airstrike on Iranian oil facilities in retaliation for Tehran's missile attack on Israel.

This escalating conflict, described as the most severe in the region since the Gulf War, led to a sharp increase in oil prices last week. However, prices have not yet spiraled out of control, largely because OPEC+ has substantial spare capacity that can be deployed if necessary to stabilize the market.

Caution Against Chasing the Rally on Over-Correction_1

Technical Analysis

In last week's surge, WTI crude broke above the neckline of a double-bottom pattern to suggest a reversal of the previous downtrend. The price is currently hovering around $75.50 and looks due for a retest.

In the 4-hour chart, the Fibonacci retracement tool shows that the 38.2% level is near the previous neckline resistance, which may now serve as support at around $72.00. A larger correction could reach the 50% Fibonacci level at $70.80 near the 100 SMA dynamic support or the 61.8% level at $69.82.

Regarding moving averages, the 100 SMA is below the 200 SMA, indicating the path of least resistance is downward, or that support levels are more likely to break than to hold. However, the gap between these indicators is narrowing, which reflects weakening bearish pressure and the potential for a bullish crossover.

If this materializes, WTI crude could continue its rebound from any of the Fibonacci levels and make its way back up to the swing high and beyond. Note that the span of the double bottom ranges from $66.30 to $72, so the resulting rally could be of at least the same size.

The stochastic oscillator has been indicating overbought conditions for quite some time, though, so heading south would confirm a return in selling pressure. There is ample room for the indicator to fall before reaching oversold conditions, suggesting the price could keep following suit. The RSI also appears ready to turn south, indicating strengthening bearish momentum. Therefore, corrections could persist until the oscillators reach oversold territory and turn upward. In terms of trading, strategic positioning remains key.

Trading Recommendations

Trading Direction: Buy

Entry Price: 72.50

Target Price: 80.00

Stop Loss: 66.00

Valid Until: Oct 22, 2024 23:55:00

Support: 73.13, 72.20, 70.35

Resistance: 76.22, 77.21, 78.76

Risk Warnings and Disclaimers

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Eva Chen

Forex

Central Bank

Summary:

Moderate growth in European consumer spending boosts confidence in economic growth. The market focus will shift to the Reserve Bank of New Zealand's rate decision on Wednesday.

SELL EURNZD

Close Time

CLOSED

1.79248

Entry Price

1.72760

1.81600

1.84394 +0.00401 +0.22%

26.0

Pips

Profit

1.72760

1.78988

Exit Price

1.79248

Entry Price

1.81600

Fundamentals

During the Asian and European sessions on Monday, the euro extended its gains against the New Zealand dollar, approaching 1.7872. Moderate growth in Eurozone consumer spending has boosted confidence in economic growth, providing some upward momentum for the pair. The Reserve Bank of New Zealand's (RBNZ) rate decision on Wednesday will be the main focus.

Last week, the New Zealand dollar benefited from China's decision to take stimulus measures to revive economic activity. The latest surge in the EURNZD is due to the market pricing in an increased probability of a 50 basis point rate cut by the RBNZ.

Earlier data showed that consumer spending in the Eurozone grew slightly in August, signaling a recovery, albeit a modest one, as the momentum of rising prices has eased.

European Central Bank (ECB) Governing Council member François Villeroy de Galhau pointed out in an interview with La Repubblica that the "balance of risks" in the Eurozone economy has changed. Villeroy stressed the importance of maintaining "full optionality" at the monetary policy meeting this month and emphasized a pragmatic approach—evaluating the situation "meeting by meeting"—which is essential. This adds to the growing chorus within the ECB suggesting that October meeting could bring about further easing if conditions warrant it. The ECB's wait-and-see approach has weakened euro assets.

On Wednesday, the market will receive the RBNZ rate decision. The last meeting took place on August 14, where they cut rates by 25 basis points and hinted at further cuts due to expected inflation remaining around the midpoint of their target range of 1-3%.

This rate cut decision came a year earlier than previously forecast by the RBNZ. The latest forecast shows that the cash rate will reach 4.9% in Q4 2024. However, investors took a more aggressive stance immediately following the central bank's decision, which anticipated a rate cut of more than 30 basis points in October.

Since then, data has shown a larger-than-expected decline in retail sales for Q2, and it still showed contraction although overall GDP growth was better than expected. Q1 data was revised down to a modest growth of 0.1% after the economy encountered a recession in the second half of 2023.

Now investors are confident that the central bank will cut rates by 50 basis points on Wednesday, followed by another 50 basis point cut in November, which suggests that the New Zealand dollar may be skewed to the upside. If policymakers do proceed with two cuts and signal a more aggressive easing stance, it will only confirm market expectations; therefore, the New Zealand dollar is unlikely to depreciate significantly.

On the other hand, if they cut rates by only 25 basis points—whether to wait for more data or due to the lack of updated economic forecasts available at this meeting—then the New Zealand dollar may resume its previous downward trend.

Technical Analysis

The EURNZD's rebound last Friday was in line with expectations. However, the rebound is likely to come to an end as part of the decline starting from August 5, with the demand zone nearing the completion of testing the supply zone at 1.7886. The downtrend is expected to resume following consolidation. The target range is the bottom of the consolidation range initiated in mid-June at 1.7381, with further downside to test the next demand zone between 1.7275 and 1.7166. The recommended strategy is to sell at highs.

Trading Recommendations

Trading Direction: Sell

Entry Price: 1.7886

Target Price: 1.7276

Stop Loss: 1.8160

Valid Until: Oct 22, 2024 23:55:00

Support: 1.7381, 1.7275, 1.7166

Resistance: 1.7886, 1.7942, 1.8030

Risk Warnings and Disclaimers

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Adam

Bond

Summary:

As of October 7, 2024, the USD/JPY pair is trading at 148.28 after hitting resistance near 148.60. The market is reacting to the strength of the USD thanks to better-than-expected US economic reports, but the Japanese Yen is showing signs of recovering from previous lows...

SELL USDJPY

Close Time

CLOSED

148.070

Entry Price

146.800

148.600

156.302 -1.112 -0.71%

1.1

Pips

Profit

146.800

148.059

Exit Price

148.070

Entry Price

148.600

The USD/JPY pair saw a strong rally, breaking above 148.50 earlier in the session. The rise was largely driven by positive economic data from the US, with the jobs report showing the labor market remained strong and the unemployment rate fell to 4%. However, the Japanese Yen is looking to rebound amid signs that the BoJ could step up its intervention in the market if the Yen weakens further.

Additionally, a sharp rise in US bond yields to near 4% has put further pressure on the Yen, although investors are now cautious about the possibility that USD/JPY could hit strong resistance around 149.00 and correct from there.

Market psychology

The overall market sentiment is cautious, with investors anticipating that the USD/JPY rally could face correction pressure due to the potential recovery of the Yen. With the BoJ likely to continue its negative interest rate policy and intervene in the market, traders are closely watching the moves from Japan. At the same time, expectations that the Fed will continue to maintain high interest rates in the near term also support the short-term rally of the USD, but may cause the market to encounter greater volatility.

Technical analysis

USD/JPY: Xu Hướng Giảm và Khuyến Nghị Bán_1

USD/JPY is trading above the Ichimoku cloud, a strong bullish signal, but the indicator suggests that the upside momentum may slow as the pair approaches strong resistance at 148.60. Failure to clear this level could see USD/JPY correct to support levels below 148.00 in the short term. The Stochastic indicator is currently in overbought territory, suggesting that selling pressure could increase in the short term as investors look to book profits from the recent strong rally. USD/JPY is trading near the upper band of the Bollinger Bands, suggesting a potential downside correction as the price hits resistance. The first support level to watch is 147.80, and a break below this level could see the pair fall further.

Based on technical indicators and market sentiment, a short-term sell strategy for USD/JPY is recommended with the expectation that the exchange rate will correct from the current resistance level.

Trading Recommendations

Entry: 148.07 (current price).

Take Profit: 147.80 (nearest support zone) or further at 147.50 if the downtrend continues.

Stop Loss: 148.60 (if price breaks above this resistance level).

Risk Warnings and Disclaimers

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