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USDJPY Holds 133 Resistance For Now

  • The latest moderation across major equity indices has sapped the momentum for USDJPY bulls on Thursday. After multiple tests towards the 133.00 handle throughout the trading session, the pair has now fallen around 60 pips and narrows in on the overnight lows of 132.21.
  • Broad USD weakness has had little impact on the pair up until this point with the firmer risk backdrop in general underpinning cross/JPY strength.
  • Overall, the trend direction in USDJPY remains down and this week’s gains are considered corrective. The 20-day EMA has been tested. Firmer resistance is seen at 133.00, the March 22 high, and the 50-day EMA that intersects at 133.38. A clear break of this EMA would highlight a stronger reversal.
  • On the downside, the bear trigger has been defined lower down at 129.64. A break would resume the downtrend and open 129.12, the Feb 2 low.
  • China PMIs & US Core PCE price index data will be in focus for global markets on Friday. On the domestic docket, March Tokyo Core CPI will be published, along with unemployment, industrial production and retail sales figures for February.

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