Chart - Courtesy Trading View
Technical Analysis:
- USD/JPY was trading 0.57% higher on the day at 128.99 at around 04:40 GMT
- The pair is set to break a 9-week bullish streak, trades 1.26% lower on the week
- Price action has paused downside at 21-EMA, further weakness only on break below
- Major trend in the pair is bullish and retrace above 200H MA will see bullish continuation
Fundamental Overview:
Investors continued to digest worries about persistently high inflation and tightening central bank policy.
U.S. Federal Reserve Chair Jerome Powell said on Thursday that the battle to control inflation would "include some pain".
He repeated his expectation of half-percentage-point interest rate rises at each of the Fed's next two policy meetings, while adding that the central bank is prepared to do more.
Concerns over inflation and China's COVID lockdowns slowing global growth are likely to keep the dollar supported.
Focus now on the release of the Michigan Consumer Sentiment Index (CSI) which is expected to print at 64 against the previous month's figure of 65.2.
Major Support Levels: 128.45 (21-EMA), 126.87 (Lower BB), 124.65 (55-EMA)
Major Resistance Levels: 129.13 (20-DMA), 129.56 (5-DMA), 131.39 (Upper BB)
Summary: USD/JPY recovery lacks traction. Break below 21-EMA will see more downside. On the flipside watch out for retrace above 200H MA for upside continuation.


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