Fundamental
Overview
The US Dollar is higher
across the board today as Trump got elected President of the US. The
Republicans won the Senate, and they just need the House now to get a red
sweep.
That is the most bullish
scenario for the greenback as it would make the tax cuts easier to pass which
should lead to higher growth and less rate cuts expectations. As of now, the
probabilities are in favour of the Republicans.
Given the above and the
strong US data we keep on getting, the Fed might start to change its stance and
we could see a much earlier than expected pause in 2025.
USDJPY
Technical Analysis – Daily Timeframe
USDJPY Daily
On the daily chart, we can
see that USDJPY bounces from the key support
around the 152.00 handle. The buyers will now start targeting the 160.00 handle,
while the sellers will need to see the price falling below the 152.00 handle to
invalidate the bullish setup and position for new lows.
USDJPY Technical
Analysis – 4 hour Timeframe
USDJPY 4 hour
On the 4 hour chart, we can
see that the price is consolidating around the highs. This is where we can
expect the sellers to step in to position for a drop back into the 152.00
handle, while the buyers will keep on piling in around these levels to extend
the rally into new highs.
USDJPY Technical
Analysis – 1 hour Timeframe
USDJPY 1 hour
On the 1 hour chart, we can
see that the price is trading above its average daily range for today. Generally, we can see
some consolidation or a bit of a pullback in such instances, but since the
election is a big catalyst, we could even see the market extend much above it.
Upcoming
Catalysts
Tomorrow we have the Japanese wage growth data, the US Jobless Claims and the
FOMC Policy Decision. On Friday, we conclude the week with the University of
Michigan Consumer Sentiment report.