The USDJPY pair strengthened after the US CPI data rose from 0.4% to 0.9% and Core CPI rose from 0.2% to 0.9%.

The impact, of course, is that the country’s inflation rate rose from 5.4% to 6.2% and this is the highest inflation rate since November 1990.

This situation certainly cannot be separated from supply chain disruptions and labor shortages, resulting in an overall price spike from food, energy, care, and housing.

If this continues, the money market will become very hot or overheated so that it can form a bubble that poses a risk to future domestic and global economic growth.

Market participants reacted immediately by releasing stocks, resulting in a decline in US stock indexes, as well as seeking temporary cover in gold and bitcoin.

However, this situation will not last long, considering that when the inflation rate looks too high, it opens the opportunity for the Fed to attract more liquidity so that the US Dollar will strengthen in the future against world currencies, including the Japanese yen.

Effect on Market

With the rising inflation rate in the United States, it will have an impact on the USDJPY pair, with a bullish tendency.

Market Expectations

It is predicted that the USDJPY pair will move in the range of 113.53 – 114.70

Trading Plans:

Buy Limit 113.24 – 113.53 with a target of 114.33 – 114.70

Stop-loss 112.45

USDJPY timeframe chart D1

Disclaimer

Fundamentals are not technicals that can change in hours or even minutes, but fundamentals are a big picture of the future that can happen over a longer timeframe.

By Antoni

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