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Mar 07 - 06:55 AM

USD/JPY - COMMENT-USD/JPY Risks A Bigger Slump As Rate Speculation Swirls

By Martin Miller  —  Mar 07 - 05:05 AM

Foreign exchange traders should beware that rate speculation and technical factors that affect USD/JPY have taken a turn for the worse.

USD/JPY hit its lowest level in one-month on Thursday on growing speculation that the Bank of Japan could end negative interest rates this month, while bets that U.S. rate cuts could come by mid-year weighed on the dollar.

USD/JPY suffered a big setback to break below the daily kijun line now at 148.39, the mid-point of the last 26 trading sessions.
If spot ends Thursday under the kijun line, that will weaken the market and increase the likelihood of a bigger drop.

Downside targets include the 146.83 Fibo, a 38.2% retracement of the 140.27 to 150.88 (December to February) EBS rise and the daily cloud currently spans the 145.01-92 region.
However, a failure to register a daily close under the kijun line would be an early sign the downside is limited.

For more click on FXBUZ

Source:
Refinitiv IFR Research/Market Commentary

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