The crisis in the Middle East is driving investors towards safe-haven assets, benefiting both the US Dollar and Japanese Yen.
Key Points
- USD/JPY rose by 0.44% due to stronger U.S. economic data earlier this week.
- Today’s USD/JPY trend is uncertain, with prices hovering near the opening level.
- Key U.S. data releases today could impact USD/JPY’s direction.
USD/JPY Daily Price Analysis – 29/08/2024
The crisis in the Middle East is consistently influencing investors decisions. At times like this, investors seek to diversify their portfolio into safe-haven assets like the US Dollar and the Japanese Yen.
While both currencies benefitted from safe-haven demand, the US Dollar gained slightly more value compared to the Yen, leading the USD/JPY pair to grow from 143.968 to 144.591, a whooping 0.44% increase in price. The USD slight edge over the JPY is as a result of stronger-than-expected economic data earlier in the week.
Today, the USD/JPY trend is unclear as the price has been hovering around the opening price of 144.531 so far.
The movement is hinting at a possible demand for the dollar, which is underpinned by expectations of continued economic strength in the U.S. This comes despite the mild dip in the 10-year Japanese Government Bond yield, which was 0.5 basis points lower at 0.885%, suggesting that Japanese bond markets are not putting downward pressure on the yen.
Key Economic Data and News to Be Released Today
Today, the U.S. is set to release key economic data, including the Preliminary GDP quarter-on-quarter (q/q) and the weekly Unemployment Claims.
The Preliminary GDP figure will provide insight into the U.S. economy’s performance in the last quarter, and a stronger-than-expected reading could bolster the dollar, leading to further gains in USD/JPY. Conversely, any signs of economic slowdown could weaken the dollar, triggering a correction in the pair.
USD/JPY Technical Analysis – 29/08/2024
In the 15-minute time frame, despite the consolidation, the general trend seems to be bullish due to the price being above the 200 EMA.
At the same time, the RSI gives a value of around 48. This value suggests that the market is not overbought or oversold, with the indicator being at a fairly neutral state. The RSI has consistently been fluctuating between the 40 to 60 range, something quite normal during a consolidation phase.
Nevertheless, the Relative Strength Index (RSI) indicator exhibited a very gentle incline after leaving the overbought place. This slight upward momentum suggests that further upward momentum could be generated if the price manages to hold above the current level.
USD/JPY Fibonacci Key Price Levels 29/08/2024
Short-term traders planning to invest in USD/JPY today should keep a close eye on the following key price levels for the day:
| Support | Resistance |
| 143.920 | 144.958 |
| 143.599 | 145.279 |
| 143.080 | 145.798 |
Risk Disclosure: The information provided in this article is not intended to give financial advice, recommend investments, guarantee profits, or shield you from losses. Our content is only for informational purposes and to help you understand the risks and complexity of these markets by providing objective analysis. Before trading, carefully consider your experience, financial goals, and risk tolerance. Trading involves significant potential for financial loss and isn't suitable for everyone.
