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May 21, 2021

This Is What Made The USD/JPY Fluctuate Fast Yesterday

 The price movement of the USD/JPY pair chart on Wednesday yesterday started to show interesting action after moving horizontally since the beginning of the week.

Both the US dollar and the Japanese Yen as safe-havend currencies are influenced by current market sentiment.

Looking at market indicators on the stock market, all three major Wall Street indices have posted declines for the third day in a row.

Thus, it can be observed that the Yen managed to strengthen against the US dollar at the beginning of the New York session yesterday while investors were wary of US dollar trading awaiting the release of the latest FOMC meeting minutes report.

The rally was seen initially in the European session yesterday on the USD/JPY chart to the level of 109.300 before the price made a decline of around 70 pips to the level of 108.600.

But the situation changed after investors scrutinized the details of the minutes of the FOMC meeting which saw the US dollar strengthen again.

Based on the documents scrutinized, members of the Federal Reserve (Fed) meeting maintained a loose monetary policy, however there were some members of the official who were willing to discuss measures to reduce bond purchases (tapering) earlier.

The US dollar strengthened again and the price rebounded above the Moving Average 50 (MA50) level on the 1 -hour time frame of the price movement signaling a bullish trend.

The continued rise is seen to be heading to the level of around 110.00 to test the resistance zone.

A higher rise is projected towards the 111.00 high which is the price resistance zone in March trading.

On the other hand, if the price makes a decline again, the price support level is seen at 108.500-108.200 which acts as an RBS (resistance become support) zone in previous trades.

The lower decline could reach up to the support level of 107,400 for the price to record its latest 4 -week low.