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The Yen Develops a "Bullish" Momentum

9/9/2022 2:10 PM

The yen is developing a "bullish" momentum against a downward correction in the US currency, trading around the 142.76 mark.

The devaluation of the Japanese currency reached such limits that any more or less positive event provoked the purchase of an asset. Yesterday, statistics recorded the rapid growth of the Japanese economy in the second quarter: the indicator added 0.9% instead of the 0.7% expected by analysts, while on an annualized basis, gross domestic product (GDP) accelerated to 3.5% from 2.2% earlier against the background of preliminary estimates of experts at 2.9%. Thus, the current policy of the financial authorities not only does not harm economic development but also does not provoke a significant increase in inflation, which is currently at 2.6%. Against this backdrop, Japan is likely to become the only state where a policy of negative rates is being implemented.

The US dollar is falling, trading at 108.700 in the USD Index. The head of the US Federal Reserve, Jerome Powell, during yesterday's speech, confirmed the regulator's commitment to the "hawkish" course of monetary policy to fight inflation and achieve the target value of 2.0%, therefore, as part of the meeting scheduled for September 21, traders expect an increase in interest rates by at least 75.0 basis points. As for local data, the markets were disappointed by another increase in Initial Jobless Claims in the US to 1.473M people from 1.437M last week.

The trading instrument is moving as part of a global uptrend, marking a local downward correction, to which technical indicators do not yet react: the Alligator indicator's EMA oscillation range is directed upwards, and the AO oscillator histogram forms bars above the transition level.

Resistance levels: 144.10, 146.50. | Support levels: 141.70, 138.92.

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