The USDJPY has been rebounding off the lows of the Tuesday sell-off at 133.40. And is presently trading at roughly 133.70, having moved so far between 133.62 and 133.91. Where it is hitting a potentially substantial resistance barrier.
The safe-haven US Dollar eventually entered the pair, putting an ordinarily strong yen on the back foot. As investors became risk-averse owing to renewed concerns over the banking sector.
The US Dollar index, DXY, reached a new high of 101.949 on Tuesday following results from First Republic Bank and UBS. Plunging deposits at First Republic Bank have revived concerns about the banking sector’s soundness. With UBS reporting a 52% drop in quarterly earnings as it prepares to swallow fallen competitor Credit Suisse.
Meanwhile, the statistics from the United States the April Consumer Confidence Index fell 2.7 points to 101.3. Its lowest score since November. Current conditions improved, climbing to 151.1 from 148.9. ANZ Bank analysts said that the decline was centered in expectations. Which decreased to 68.1 versus 74.0.
The dismal consumer confidence report and a drop in Federal Reserve manufacturing statistics boosted the Dollar’s safe-haven appeal even further.
As markets become risk-off, the Bank of Japan will provide guidance this week.
In other news, the Yen strengthened, behaving like a traditional safe haven, even as Bank of Japan (BOJ) new governor Kazuo Ueda said he was not in a rush to change policy. Ueda will preside over his first BoJ meeting, which finishes on Friday.
USDJPY Technical Outlook
USDJPY Bears in the market eye the 133.20s, where the 1-hour chart revealed that the M-formation’s neckline was linked with the 133.70s and resistance.
A subsequent advance to the 133.20s might be on the cards if the bears remain committed over the coming sessions,” it was also suggested.
For the time being, the price is being resisted and falling while being on the front side of the micro bearish trendline.
