JPY is Murky, the US-Japan Policy Become a Weather Vane 

In this comprehensive analysis, Ultima Markets brings you an insightful breakdown of the USDJPY for DEC 18, 2024. 

Fundamental Analysis 

USDJPY Key Takeaways 

• Retail sales is not terrible: US retail sales in November recorded a monthly rate of 0.7%, the highest since September, and the market expected an increase of 0.5%. Retail sales in November increased from the previous month, reflecting the continued resilience of US consumers and an initial sign of a strong start to the US holiday shopping season. The report failed to trigger a significant market reaction. 

• Bank of Japan: The Bank of Japan will announce the results of the interest rate meeting at noon on December 19 (Thursday), and the Bank of Japan is likely to maintain monetary policy unchanged. The market believes that the highlight of this meeting is whether President Ueda will hint at a rate hike at the next meeting at the press conference after the meeting. 

• Fed rate cut: The Fed will announce the interest rate decision before the Bank of Japan, and will also announce a summary of future economic expectations in December. This meeting is likely to cut interest rates by 25 basis points, and the market is more concerned about the interest rate path of the dot plot next year. 

Technical Analysis 

USDJPY Daily Chart Insights 

(USDJPY Daily Price Chart, Source: Ultima Markets MT4) 

• Stochastic oscillator: The fast line is about to turn downward after entering the overbought area, suggesting that the short-term bullish power is insufficient, and the exchange rate has the probability of adjusting downward when encountering key resistance levels. 

• Resistance price: USD/JPY was blocked by the order block (OB) horizontal price level, and fell yesterday. At present, there is an upward rebound trend in the Asian session. Even if the order block resistance price level is broken, the exchange rate may be blocked near the 78.2% Fibonacci retracement level. 

USDJPY 1-hour Chart Analysis 

(USDJPY H1 Price Chart, Source: Ultima Markets MT4) 

• Stochastic oscillator: The indicator sends a bullish signal in the oversold area, and the market price may rebound and rise during the Asian session. During the Asian session, the fast and slow lines successively entered above the 50 median line, which clearly showed that the rebound was relatively strong and would continue to rise in the short term. 

• MA signal: If the purple 13-period MA does not cross the black 65-period MA, the exchange rate will rebound and break through the MA resistance. There is a probability of a small decline in the exchange rate. If the exchange rate breaks through the short-term high of 153.766 again after the adjustment, the USD/JPY is likely to continue to rise before encountering daily resistance. 

USDJPY Pivot Indicator 

(USDJPY M30 Price Chart, Source: Ultima Markets APP) 

• According to the trading central in Ultima Markets APP, the central price of the day is established at 154.00, 

• Bullish Scenario: Bullish sentiment prevails above 154.00, first target 154.50, second target 154.85; 

• Bearish Outlook: In a bearish scenario below 154.00, first target 153.10, second target 152.70. 

Conclusion 

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