Monday, November 23, 2015

USD/JPY: Bulls in control, regains hourly 100-SMA

FXStreet (Mumbai) - Despite Japanese traders away on a national holiday, increased volatility was experienced around the USD/JPY pair, with the prices benefiting most from broad based US dollar strength.

USD/JPY tested hourly 100-SMA at 123.18

Currently, the USD/JPY pair trades 0.30% higher at fresh session highs of 123.19, fighting its way through 5-DMA placed at 123.10. The rising demand for the greenback after a series of hawkish Fed speak last week, with the latest from Fed’s William delivered over the weekend, boosts the major beyond 123 handle. Fed's Williams noted that should data meet or surpass expectations, there is a 'strong case' for a December hike.

While the recent streak of US fundamentals have added to the signs of strength in the US economic recovery and has further bolstered Dec Fed lift-off bets. Moreover, the latest chatter that Fed will hike discount rates which it charges to other banks tonight, further added to the positive sentiment around the USD/JPY pair.

Looking ahead, markets will continue to digest the latest Fed speak ahead of the US manufacturing PMI and existing home sales data due later today.

USD/JPY Technical levels to watch

The prices surpasses 123 handle and face immediate resistance at 123.64 (Nov 20 High). A break above the last, the major could test 124.17 (Aug 21 High). To the downside, the immediate support in sight at 122.97 (10-DMA) below which 122.54 (20-DMA) would be tested.
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