USDJPY Is Bullish Before FED Interest Rate Decision

USDJPY Bullish before the Fed decisoin

USDJPY is on fire! The price broke out at the 135.00 level and moved towards the 138.00 psychological level of resistance, which I consider a 138.00 – 139.35 potential zone resistance. 

Well, long-time waited for that Double Bottom Pattern to form, and it started. If the price breaks the mentioned zone of resistance, then it could strike up to 142.00 and 145.00 levels. 

The Pattern completion is at the 1.4600 level. And If the price fails to reach 146 and shows weakness, I will keep an eye on the mentioned levels earlier. 

Moving on Daily time frame chart, we can see more details on the price action and S/R levels. The price broke above the bullish channel forming as a second low of the double bottom pattern. 

Risistance levels: 138.00, 139.35, 142.30, 145.00
Support levels: 135.00, 133.10, 132.00, 130.50

On the fundamental scale (read here for more details), I can add that the price is rising because of fear of hawkish Fed decisions and speeches. The ISM Manufacturing PMI data was on a slight uptick today, which was taken as a dangerous signal from the market, even though the data suggests that it is still contracting. This is not pointing out an expanding economy, but just before the FED rate decision, markets are sensitive, and any pro-inflationary data might affect the market’s prices significantly. 

I believe that FED will increase interest rates by 25 bp, and it is likely to be the last one. If so, they will ensure that even if this is the last rate hike for now, it is not a “pivot”, cause they are going to hold rates high. 

This wave of fear and rate hike will boost the USD. The second bull wave for USD could be when the government solve the Debt Ceiling issue. 

I will share more about USD and the Macrio situation on my XM Live Trading and Education sessions here

You can also take advantage of my Private Trading and Education Room here. 

The goal of this post is only to inform and educate the website visitors and not to give any trading or investing advice! Make sure you learn the risks of trading and investing in the financial markets before you take any trading decision. 

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