USD/JPY Price Analysis: Bulls looking for a break towards 146.00
06.10.2022, 18:29

USD/JPY Price Analysis: Bulls looking for a break towards 146.00

  • USD/JPY bulls have moved up into the 145.00 area and eye a run towards 146.00.
  • The US dollar and US yields are running higher. 

On Thursday, despite downbeat Initial Jobless Claims, the US dollar rallied as per the DXY index which measures the greenback vs. a basket of currencies. This is turn has seen USD/JPY rally on the back of higher US yields, extending their gains from the previous day as illustrated in the technical analysis below. 

Fundamentally, the focus is now going to be on the Nonfarm Payrolls (NFP) tomorrow and then next week, the Fed receives the latest report on consumer inflation.

US 10-Year Yield H1 chart

US benchmark Treasury yields whose recent gains have helped to drive the greenback higher, were up to test the prior resistance at 3.841%. The yield was piercing those highs on Thursday and printing 3.844% as Wall Street cash markets fell in the open.

Meanwhile, forex has been volatile this week and the US dollar along with it. The greenback has struggled to find a clear direction following a dramatic third quarter, but on Thursday, higher by some 0.8% and back above 112.00, it has been regaining ground and is up about 17% for the year so far:

DXY H1 chart

USD/JPY H1 chart

As for USD/JPY, if the dollar starts to fold at the top of the rising channel, as illustrated above, then there will be prospects of a move lower to test the bulls commitments at the trendline support between 144.90 and 144.70. The bears will be back in charge below 144.35 and 144.05. 

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