According to FXStreet, the USD/JPY pair increased to nearly 144.60 in the early trading session in Asia this morning, September 26. The main reason is the weakening of the US dollar (USD) due to expectations that the Fed will cut interest rates sharply in November, continuing to affect this pair. Investors are waiting for new economic data and signals from the Fed about upcoming interest rate cuts.
According to the US Department of Commerce, new home sales in August fell 4.7% to 716,000 units, down from 751,000 units in July (after adjustment), but still higher than market expectations. Previously, a report on US consumer sentiment showed weaker-than-expected results, causing many to worry about the labor market and raising expectations of the Fed cutting interest rates further.
On the Japanese side, the Bank of Japan (BoJ) will release the minutes of its July policy meeting on Thursday. BoJ members called for a slow and cautious rate hike. Some see a 0.25% rate hike to adjust monetary support levels, while others see a more gentle adjustment.
Japanese Finance Minister Shunichi Suzuki said on Tuesday that the BoJ will implement appropriate monetary policy and continue to coordinate with the government. If the BoJ delays the rate hike, it could weaken the JPY and help maintain the USD/JPY rally.
Despite a recovery in the trading session, USD/JPY is still on a downward trend, as the exchange rate remains below Ichimoku (Kumo) cloud and the 200-day moving average (DMA).
The Relative Strength Index (RSI) has just overcome its neutral line, opening up the possibility of further increase in the short term.
In such a situation, the next resistance level for USD/JPY will be 145.00, before testing the 50-day moving average at 146.73. If it continues to be strong, this pair could reach 147.00.
According to Lao Dong, at 3:00 p.m. on September 25, the exchange rate of the Japanese Yen against the US dollar is currently anchored around the lowest level of the day at 144.44 JPY and the highest at 144.77 JPY.
