FundamentalOverview

The USD gained groundacross the board last week amid risk-off flows and renewed tariffs fears. Infact, we got some weak US data coupled with new cycle highsin inflation expectations.

This is something to keepin mind in light of the next NFP and CPI reports coming out before the MarchFOMC decision where we will also get the updated SEP and Dot Plot. Moreover,last Thursday, Trump repeated that tariffs on Mexico and Canada will go intoeffect on March 4^th as planned and that he will impose additional10% tariffs on China.

On the JPY side, nothinghas changed fundamentally but the Japanese Yen has been supported across theboard by the risk-off sentiment and falling Treasury yields. Last Friday, theJPY weakened as the TokyoCPI missed expectations and saw the market paring back the bets for a thirdrate hike by the end of the year.

USDJPYTechnical Analysis – Daily Timeframe

On the daily chart, we cansee that USDJPY eventually bounced from the 148.60 level and pulled back intothe 150.93 resistance.This is where we can expect the sellers to step in with a defined risk abovethe resistance to position for the break below the 148.60 level. The buyers, onthe other hand, will look for a break higher to extend the pullback into the trendlinewhere they will target a break above it.

USDJPY TechnicalAnalysis – 4 hour Timeframe

On the 4 hour chart, we cansee more clearly the pullback into the resistance with some rangebound priceaction now. There’s not much else we can add here as the sellers will likelypile in for a drop back into the 148.60 level, while the buyers will look for abreak higher to extend the rally into the major trendline.

USDJPY TechnicalAnalysis – 1 hour Timeframe

On the 1 hour chart, we cansee that we have a minor support zone around the 150.18 level where the pricegot rejected from several times in the past days. This is where we can expectthe buyers to step in to position for the break above the resistance, while thesellers will look for a break lower to increase the bearish bets into the148.60 level next. The red lines define the average daily range for today.

UpcomingCatalysts

Today we get the US ISM Manufacturing PMI.Tomorrow, we have the Trump’s tariffs deadline for Mexico, Canada and China. OnWednesday, we have the US ADP and the US ISM Services PMI. On Thursday, we getthe latest US Jobless Claims figures. On Friday, we conclude the week with theUS NFP report.

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