USD/JPY Rejected at Channel Resistance, Nasdaq 100 Comes Alive as US Yields Tank

USD/JPY ANALYSIS

USD/JPY rose to multi-month highs throughout Tuesday’s European session, however erased features and reversed course sharply following weak and lackluster U.S. financial knowledge. By late afternoon, the pair was shedding 0.35% to commerce at 146.00, after reaching a peak of 147.37 within the morning.

Earlier within the day, the most recent client confidence survey confirmed that sentiment had fallen sharply and greater than anticipated in August, dropping to 106.01 from 114.00 beforehand and erasing consecutive features in June and July.

One other report revealed that job openings fell to eight.eight million in July, reaching their lowest degree since March 2021, a transparent indication that the labor market is weakening, buckling below the load of restrictive financial coverage aimed toward curbing inflation.

US ECONOMIC DATA

Supply: DailyFX Financial Calendar

Unfavorable macro outcomes have decreased the chance of further Fed tightening, although they haven’t eradicated the potential for additional coverage firming totally. On this context, yields have begun to go downwards, making a considerably bearish backdrop for the U.S. greenback within the session.

For a sustained retreat in USD/JPY, there must be constant proof of a slowdown within the U.S. economic system. In any other case, the pair may preserve its long-term uptrend as soon as the mud settles, supported partly by the Financial institution of Japan’s ultra-loose financial stance.

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USD/JPY TECHNICAL ANALYSIS

From a technical evaluation standpoint, USD/JPY jumped and charged at channel resistance at 147.40 on Tuesday, however the rally couldn’t preserve its momentum and confronted a swift rejection, signaling an aggressive focus of sellers only a powerful under 147.50.

Even with the retracement, the general outlook for the pair stays bullish, evident from the constant sample of upper highs and better lows. However, given the substantial upward motion seen this 12 months, the potential for a consolidation part ought to be considered.

Specializing in main worth ranges, assist rests at 144.60, adopted by 143.85. Additional down the road, consideration shifts to the 50-day easy shifting common. On the resistance facet, the primary ceiling to think about emerges at 147.40, and 149.00 thereafter.

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USD/JPY TECHNICAL CHART

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NASDAQ 100 TECHNICAL ANALYSIS

The Nasdaq 100 soared on Tuesday, marking its third consecutive buying and selling session of features. This ascent not solely counteracted a portion of the losses incurred over the earlier 4 weeks but in addition picked up momentum from the anticipation that worsening U.S. financial knowledge will immediate the Federal Reserve to stop price hikes earlier than transitioning to a extra dovish stance in early 2024.

Turning to technical evaluation, the tech index has managed to overhaul its 50-day easy shifting common following the most recent upswing. If this transfer is sustained, the bulls might grow to be emboldened to launch an assault on 15,500, the subsequent resistance to keep watch over. Profitable clearance of this barrier might open the door for a retest of the 2023 peak.

Within the occasion of a bearish reversal, preliminary assist comes into view close to 14,850. This flooring aligns with the lows seen on June 26-27 and coincides with a medium-term rising trendline. Whereas the Nasdaq 100 may discover stability round these ranges throughout a pullback, a breakdown has the potential to accentuate promoting strain and set up situations conducive to a decline towards 14,600.

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NASDAQ 100 TECHNICAL CHART

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