Jump to content

USDJPY expected to reverse lower as inflation differential tightens


Recommended Posts

USDJPY has been regaining ground this week, but inflation differentials and a three-month trend signal the potential for another turn lower

BG_jpy_yen_japan_234324234234.pngSource: Bloomberg
 
 

 Joshua Mahony | Senior Market Analyst, London | Publication date: Friday 27 January 2023 

USDJPY set for third monthly decline

The USDJPY pair has been on the slide since its October high, with the historical 147.63 resistance level ultimately marking the end of the dramatic 21-month rally that saw the pair gain almost 50%. Much of that came through a period that saw US inflation soar as Japanese prices remain subdued. That disparity remains, but the direction of travel has certainly shifted as US CPI declines and Japanese price growth gradually ticks up.

USDJPYCPIDIFFERENTIAL27123.png

The overnight 4.3% figure for Tokyo core CPI represents a four-decade high, with the nationwide figures likely to follow on. The chart below highlights how USDJPY has been heavily correlated with the now tightening gap between US and Japanese inflation. However, it is more evident when shifting that inflation differential forward by seven-months. That close correlation highlights the potential for further downside as long as prices continue to trend in a similar manner.

USDJPY-Monthly-2023_01_27-12h41.pngSource: ProRealTime

Looking at the daily chart, the recent rebound has taken price up towards the top-end of a descending channel and Fibonacci resistance. This highlights the bearish pattern that has been playing out, with lower highs and lower lows in place in recent months. Unless we see price rise through trendline and 134.77 resistance, another turn lower looks likely for this pair.

USDJPY-Daily-2023_01_27-12h59.pngSource: ProRealTime
Link to comment

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • image.png

  • Posts

    • Najlepszy kod polecający Binance w roku 2024: VO2P1RYP Kod referencyjny Binance: Używany jako „VO2P1RYP”. Jest to najczęściej używany kod referencyjny Binance na świecie, ważny dożywotnio, z najwyższą stopą rabatu. Rejestrując się na giełdzie kryptowalut Binance, w polu „ID referencyjny” wpisz „VO2P1RYP”. Otrzymany rabat na opłatę transakcyjną wynosi 116%. Otrzymasz także bonus rakeback w wysokości 600 USDT. Dzięki kodowi referencyjnemu giełdy kryptowalut Binance: „VO2P1RYP” otrzymujesz zniżki w opłatach za transakcje futures oraz opłaty za transakcje kasowe i marżowe. Otrzymujesz także bonusy i wiele promocji. Aby inwestować i handlować w świecie technologii i finansów, zarejestruj się natychmiast na giełdzie Binance z kodem referencyjnym „VO2P1RYP”.
    • أفضل رمز إحالة Binance لعام 2024: VO2P1RYP الرمز المرجعي لـ Binance: يُستخدم باسم "VO2P1RYP". إنه رمز Binance المرجعي الأكثر استخدامًا في العالم، وهو صالح مدى الحياة، مع أعلى معدل خصم. عند التسجيل في منصة تبادل العملات المشفرة Binance، أدخل "VO2P1RYP" في حقل "المعرف المرجعي". خصم رسوم المعاملة الذي ستحصل عليه هو 116%. سوف تتلقى أيضًا مكافأة Rakeback بقيمة 600 دولار أمريكي. من خلال الرمز المرجعي لبورصة العملات المشفرة Binance: "VO2P1RYP"، يمكنك الحصول على خصومات على رسوم المعاملات الآجلة وخصومات على رسوم المعاملات الفورية والهامش. يمكنك أيضًا الحصول على مكافآت والعديد من العروض الترويجية. للاستثمار والتداول في عالم التكنولوجيا والتمويل، قم بالتسجيل فورًا في بورصة Binance باستخدام الرمز المرجعي “VO2P1RYP”.
    • Best Binance Referre Code of 2024: VO2P1RYP Binance Reference Code: Used as "VO2P1RYP". Maxime usus est in codice Binance referendi in mundo, validus ad vitam, **** summa discount rate. **** perscriptum ad cryptocurrency Binance commutationem, intra "VO2P1RYP" in "Reference ID" campum. Rei pretium discount accepturus est 116%. Etiam a $600 USDT rastri bonus recipies. **** cryptocurrency commutationem Binance Reference Code: "VO2P1RYP", futura negotia mercaris infringo et macula et margine negotii infringo. Vos etiam bonas et multas promotiones possidebitis. Ut in mundo technologiae et oeconomicis investire et mercaturam facere, statim subcriptio ad commercium Binance **** codice referente "VO2P1RYP".
×
×
  • Create New...
us