Key Highlights
- USD/JPY is showing signs of a downside correction from 148.80.
- It traded below a key bullish trend line with support at 147.75 on the 4-hour chart.
- EUR/USD is struggling to recover above the 1.0900 resistance zone.
- The US GDP grew at a 3.3% annual rate in the fourth quarter of 2023.
USD/JPY Technical Analysis
The US Dollar remained strong after a close above 146.50 against the Japanese Yen. USD/JPY peaked near 148.80 and recently started a downside correction.
Looking at the 4-hour chart, the pair corrected lower below the 148.00 level. There was a break below a key bullish trend line with support at 147.75. The pair tested the 146.80 support zone and the 23.6% Fib retracement level of the upward move from the 140.24 swing low to the 148.80 high.
If the bears remain in action, the pair might decline below the 146.80 support. The next major support sits near the 146.20 level and the 100 simple moving average (red, 4 hours).
A downside break below the 146.20 zone could spark another sharp decline. The next major support is 144.50 or the 200 simple moving average (green, 4 hours). It is close to the 50% Fib retracement level of the upward move from the 140.24 swing low to the 148.80 high.
Any more losses might call for a drop toward the 142.20 support. On the upside, the pair is facing resistance near the 148.20 level.
The next key resistance is near the 148.80 level. A close above the 148.80 zone could open the doors for more upsides. The next stop for the bulls might be 149.50. Any more gains might send USD/JPY toward the 150.00 level.
Looking at EUR/USD, the pair is consolidating losses near 1.0850 and struggling to gain pace for a move above the 1.0920 resistance.
Economic Releases
- US Personal Income for Dec 2023 (MoM) – Forecast +0.3%, versus +0.4% previous.
- US Core Personal Consumption Expenditure for Dec 2023 (MoM) – Forecast +0.2%, versus +0.1% previous.
