December 7, 2022

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USDJPY dips to swing area after “as expected” CPI

1 min read

It wasn’t any worse than last month at least.

The US CPI came in more or less as expected.  The YoY at 5.4% was unchanged from last month. The market took the data as being a relief. As a result the dollar has declined from pre-release levels.

It wasn't any worse than last month at least.

Looking at the USDJPY, the pair moved initially lower to a session low of 110.391. That low stalled in the middle of a swing area between 110.35 and 110.418. The price bounced off that level and currently trades around 110.52 (just above it).  

Traders are trying to hold that level if there is a break the 100 hour moving average comes in at 110.215 (blue line). That would be the next major target on further selling. The price moved above the 100 hour moving average back on August 4, retested that moving average on August 5 before moving higher over the last five trading days to the high today.

Speaking of the high today, it stalled right near a swing area going back to July 5 to July 7th (see green numbered circles). Those levels were initially support (on July 5), then resistance (on July 6 and July 7) after the break lower.  The price has not been back that level since those dates.  

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