USDJPY: SELL 144.70, SL 145.70, TP 142.70 | 19 May 2025

USDJPY:

The Japanese yen (JPY) rose against its US counterpart for the fourth consecutive day and reached a new weekly top in the Asian session on Friday. Yen buying has been relentless since the release of weaker-than-expected Japanese first quarter GDP data amid growing confidence that the Bank of Japan (BoJ) will raise interest rates again. In addition, trade talks between the US and Japan seem to be progressing as officials continue to meet regularly, which is another factor supporting the Japanese Yen.

The aforementioned factors have overshadowed the recent optimism driven by easing fears of an all-out global trade war, which has recently caused investors to rush into risk assets and away from traditional safe-haven assets, including the Yen. The US Dollar (USD), on the other hand, continues to struggle to attract buyers as signs of easing inflationary pressures and weak consumer spending data confirmed bets on further rate cuts by the Federal Reserve (Fed). This is sharply at odds with BoJ expectations and favours the JPY bulls.

Trade recommendation: SELL 144.70, SL 145.70, TP 142.70

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