The USD/JPY currency pair

• Prev Open: 135.90
• Prev Close: 137.14
• % chg. over the last day: +0.91 %

The Bank of Japan faces problems that no other central bank faces. As demand in the country has been declining for decades, the central bank has used stimulative monetary policy for years to restore it. The country’s domestic inflation is now at a 40-year high at 4%, but it’s not much compared to other major economies. Among the world’s leading central banks, the Bank of Japan has not raised interest rates since 2016 while adhering to its “Yield Curve Control” (YCC) policy to keep long-term interest rates low. This involves buying virtually unlimited amounts of Japanese government bonds. The new BoC Governor, Ueda, who is likely to take Kuroda’s place after April 8, will also be constrained by the same circumstances.

• Support levels: 137.09, 136.42,135.25, 134.04, 133.47,
• Resistance levels: 138.15, 138.88

From the technical point of view, the medium-term trend on the currency pair USD/JPY is bullish. The uptrend trend continues, and the price is steadily growing, breaking through the resistance levels one after another. The MACD indicator is positive, and there are signs of overbought. To buy at such heights is not the best idea, so it is better to wait for a small correction. Under such market conditions, it is better to look for buy deals from the support level of 137.09, but only with intraday confirmation. Sell deals can be searched from the 138.15 level, but with additional confirmation in the form of a reverse initiative on the lower time frames.

Alternative scenario: if the price fixes below the 135.25 support level, the downtrend will be resumed with a high probability.

The USD/CAD currency pair

• Prev Open: 1.3612
• Prev Close: 1.3753
• % chg. over the last day: +1.04 %

The OECD’s latest Canadian Economic Survey says that faster growth in living standards will require a stronger business environment to bring Canada’s weak productivity and investment growth in line with the leading economies. The Survey presents updated GDP growth forecasts of 1.3% for 2023 and 1.5% for 2024. The tight monetary policy last year will help reduce inflation to 2% by the end of 2024. Public finances are also expected to strengthen in 2023, helped in part by rising commodity price revenues. The Bank of Canada will also meet today on monetary policy. Economists believe the BoC will not raise rates, but the key question will be whether the BoC will leave the door open for further hikes.

• Support levels: 1.3711, 1.3664, 1.3645, 1.3515
• Resistance levels: 1.3775, 1.3853

From the point of view of technical analysis, the trend on the USD/CAD currency pair is bullish. The triangle pattern is classically triggered in the continuation of the trend. The price impulsively broke through all the levels and rushed upwards. At the moment, the price is trading above the moving averages. The MACD indicator is overbought. Under such market conditions, it is worth looking for buy deals from the support level of 1.3711 or 1.3664, but only with confirmation in the form of reaction on the lower time frames. Sell positions can be searched from the resistance level of 1.3775, but only with a confirmation in the form of a false breakout and short targets.

Alternative scenario: if the price breaks down and consolidates below the support level of 1.3600, the downtrend will likely resume.

• – Canada Trade Balance (m/m) at 15:30 (GMT+2);
• – Canada BoC Interest Rate Decision at 17:00 (GMT+2);
• – Canada BoC Rate Statement at 17:00 (GMT+2);
• – US Crude Oil Reserves (w/w) at 17:30 (GMT+2).