The USDJPY retraces the declines from the FOMC rate decision last wk.Is the high in place?

The US dollar has been the strongest currency over the last three-days rebounding from a recent sharp selloff you, as confidence grows that the Federal Reserve has concluded its cycle of interest rate hikes.

That move higher took the USDJPY back above the 150.00 level yesterday and to the 151.00 level today. Traders are still monitoring the Japanese yen’s performance above the 150 level against the dollar for potential intervention.

Many traders and analysts anticipate a slowdown in the U.S. economy in the fourth quarter, diminishing the likelihood of further rate hikes and undermining the attractiveness of the greenback, which has benefited from the relative strength of the U.S. compared to other major economies. The Fed Chair’s comments after the FOMC rate decision last week were thought to be more dovish and led to lower rates and a lower dollar. However, the greenbacks move back to the upside has eaten into the declines.

The price of the USDJPY was trading around 151.00 at the time of the rate decision on Wednesday, November 1.

Although the USDJPY may continue to gain in the short term as it recovers from last week’s selloff, reaching the 151.0 level and finding sellers may attract sellers.

The Fed funds futures suggest a 17% chance of another rate hike by January but a 20% chance of rate cuts as early as March.

Technically, looking at the hourly chart, a move back below the 150.75 area could see some additional selling as confidence that the 151.00 level set a top. Conversely, if the 150.75 area cannot be broken, that will keep the buyers in play and still more in control.

Be aware.

This article was written by Greg Michalowski at Source