Detailed FX Market Outlook and Analysis

USD/JPY Daily Analysis 10-April-2023

USD/JPY Daily Analysis

For the past three days, the USDJPY has maintained a positive tone, due to a boost in market sentiment and strong US job data that has bolstered the dollar.

On Monday, the pair extended its gains, breaking through the thick daily Ichimoku cloud (which has its cloud base at 132.15) and surpassing the pivotal Fibonacci resistance level at 132.79 (which represents 38.2% of the 137.90/129.64 range).

To keep the bulls in play, it is essential for the USDJPY to remain above the cloud base (which is reinforced by the daily Tenkan-sen). A continued extension and a close above the 132.79 resistance level could signal further recovery.

There are key barriers located at 133.75/77 (which include the April 3 high, 50% retracement of the 137.90/129.64 range, and the daily Kijun-sen) and 134.08 (the daily cloud top). If the pair manages to break through these levels, it could generate a strong bullish signal (which would also be confirmed by the completion of the bullish failure swing) and expose targets at 134.75/135.11 (which are the Fibonacci 61.8% and mid-March lower platform, respectively).

However, it is important to exercise caution if the USDJPY dips and closes below the daily cloud base. This could indicate a fading bullish momentum on the daily chart, sending warning signals that could stall the recovery and lead to the possible end of the three-day upward trend.

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