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The USD/JPY 151 mark sounds the alarm! Yen bulls hold three sharp swords
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Hello everyone, today XM Forex will bring you "[XM Group]: The US dollar/yen 151 mark sounds the alarm! Japanese yen bulls hold three sharp swords." Hope this helps you! The original content is as follows:
On Wednesday (October 15) during the Asia-Europe period, the U.S. dollar fluctuated and weakened against the Japanese yen, once falling below the 151 integer mark, refreshing a one-week low to 150.90, a decrease of about 0.62%, and currently rebounding slightly to around 151.18. Changes in Trump's trade stance, escalating geopolitical tensions and concerns about a possible long-term U.S. government shutdown continue to support demand for traditional safe-haven assets, including the yen. In addition, Finance Minister Kato's recent remarks have triggered speculation that the government may intervene in the currency market, which has become another key factor supporting the yen.
However, the market is gradually realizing that recent political developments in Japan may force the Bank of Japan to further delay raising interest rates, which may inhibit the willingness of yen bulls to build new positions.
Federal Reserve Chairman Powell’s remarks on Tuesday raised market expectations that the Federal Reserve will cut interest rates twice this year, putting pressure on the U.S. dollar, which provided support for the further decline of the U.S. dollar against the yen.
The yen keeps rising amid continued safe-haven buying and intervention concerns
U.S. President Trump has threatened to raise tariffs to 100%. What's more, Trump threatened to terminate trade in areas such as edible oil. These actions triggered market concerns about further escalation of trade friction, and safe-haven assets gained support.
Media reports claim that Trump is considering providing Ukraine with Tomahawk long-range cruise missiles to force Russian President Vladimir Putin to return to the negotiating table. Geopolitical risks continue to ferment, pushing the yen to strengthen on Wednesday.
At the same time, the Republican-backed temporary funding bill failed to obtain the votes needed to pass in the Senate vote on Tuesday, which means that since 10The partial federal government shutdown that began on March 1 will enter its third week, and there is currently no sign of a solution.
The Liberal Democratic Party-Komeito ruling alliance suddenly collapsed last week. This change means that the newly elected leader of the Liberal Democratic Party, Takaichi Sanae, needs the support of other parties to become Japan's prime minister and implement its key policies. Kyodo News reported on Wednesday that the Japan Diet Schedule xmspot.committee failed to reach an agreement on holding a vote for the prime minister election on October 21.
This political uncertainty may hinder the Bank of Japan's interest rate hike process, thus posing resistance to the yen. However, the market is still betting that the Bank of Japan may further tighten monetary policy during the year, which is a significant divergence from the market's dovish expectations for the Federal Reserve. The Chicago Mercantile Exchange's FedWatch tool shows that the market has fully priced in a 25 basis point interest rate cut by the Federal Reserve in October, and believes that the probability of another interest rate cut in December is as high as 90%. This divergence in policy expectations continues to weigh on the dollar, pushing it lower against the yen.
If it effectively falls below the 151.00 mark and remains below it, the decline of the US dollar against the yen may accelerate
This week, the US dollar against the yen failed to rise multiple times and failed to effectively break through the 100 hour moving average (152.23), and then fell below the 200 hour moving average (151.35). This may become a key signal for short sellers. Momentum indicators are all in negative territory, reinforcing bearish momentum.
On the downside, if the exchange rate falls below the 151.00 mark and stabilizes below this level, it will confirm the short-term bearish outlook, pushing the exchange rate to test the 150.70 support level, and then challenge the 150.00 psychological mark.
On the upside, if the intraday rebound breaks through the 151.65-151.70 resistance area, it may face direct resistance near the 152.00 integer mark. Further upside will encounter selling pressure near 152.25, and the upside space is expected to be limited in the 152.65-152.70 area. Only by standing firmly above this resistance range can the current technical pattern be reversed, opening up room for the bulls to push the exchange rate above the 153.00 mark, and retest the eight-month high of the 153.25-153.30 range hit last Friday.
The above content is all about "[XM Group]: The US dollar/yen 151 mark sounds the alarm! Japanese yen bulls hold three sharp swords". It is carefully xmspot.compiled and edited by the XM foreign exchange editor. I hope it will be helpful to your trading! Thanks for the support!
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