However, the market still pushed the rate higher and at mid-Friday the US statisticians revealed that the employment in the USA does not favour a US rate cut. The USD surged against all other assets. By mid-Monday, the rate is again at the prior high level zone at 151.75/151.97. The USD/JPY is again at levels that the Bank of Japan is against.
Economic Calendar
This week, US inflation data sets are in focus.
The United States Consumer Price Index will be released to the public on Wednesday at 12:30 GMT. The markets expect US inflation to show an average price increase of 0.3% in core and base levels. This would mean annual inflation of 3.4%, which is an increase, compared to March's 3.2%.
Higher inflation indicates that the Federal Reserve cannot cut interest rates and tightening of USD supply is needed. Namely, high inflation equals higher US Dollar value. Lower inflation is set to create the opposite – a decline of the USD.
On Thursday, at 12:30 GMT, additional US inflation data will be released. The less noteworthy Producer Price Index will be published.
The PPI shows price changes at the producer level. Base theory is that all price increases at the production level are sooner or later passed down to the consumer, as the producers want to stick to their profit margins. Namely, the PPI is a pre-signal to what will happen with the CPI.
USD/JPY hourly chart analysis
In general, if the Japanese monetary policy makers once again take action, the rate could plummet. A potential decline could find support in the combination of the 50, 100 and 200-hour simple moving averages and the weekly simple pivot point at 151.46. Further below, take into account the support zone above 151.00 and the weekly simple pivot point at 150.97. If these levels fail, the 150.70/150.9 range could come into play once again.On the other hand, a move above 152.00 could be impacted by the 152.11 level where the weekly R1 simple pivot point is located at. Meanwhile, note that fundamental announcements by the Bank of Japan are highly likely. The bank is known for involving directly in the market and manipulating it by selling or buying large amounts of Yen against the US Dollar.
Hourly Chart
USD/JPY daily chart's review
The daily candle chart of USD /JPY is flat. The pair is sideways trading between 150.95 and 152.00. Note that the 152.00 level marks the 2022 high level.Daily chart
During Monday's trading, trader open position volume showed that Dukascopy traders were 63% long.
Meanwhile, pending orders in the 100-point range around the rate were 60% to sell the USD/JPY.
By late Thursday's trading, traders were 63% long and orders were 55% to sell. Traders did not change their expectations during the events. Namely, Dukascopy traders think that the BoJ will fail at keeping the rate down.