Daily Price Outlook

Gold's price (XAU/USD) has been steadily climbing, recently breaking through the $1,923 mark. It's been in the green for two days in a row, though not with tremendous strength. Traders are awaiting the release of the latest US consumer inflation data scheduled for Wednesday. However, the uptick in gold prices was due to the weakening US Dollar, which makes gold more attractive as an alternative investment. Moving on, the upside seems limited ahead of the US CPI on Wednesday and Thursday's ECB policy meeting.

Impact of USD and Economic Data on Gold Prices

Investors are keeping a close eye on the August US Consumer Price Index (CPI) data as it reveals inflation trends. However, the Federal Reserve (Fed) may stick to its current policies because of low inflation and a weak job market, which could make gold less appealing. On the other hand, a strong US dollar can manage higher interest rates and positive economic news. There's a chance the Fed might raise rates by 25 basis points, possibly in November or December, which could limit gold's upward momentum.

Meanwhile, the positive US economic data from last week suggests a strong economy, which means the Federal Reserve (Fed) can maintain higher interest rates for an extended period. This confident stance supports higher US Treasury bond yields and pushed the US Dollar (USD) to a six-month high last week. The positive US economic data indicating a strong economy has led to expectations of the Federal Reserve maintaining higher interest rates, boosting US Treasury bond yields and the US Dollar (USD). However, recent profit-taking and a weaker USD have offered some support to the Gold price, which tends to perform better in a weaker dollar environment.

Gold's Safe-Haven Appeal Amid Economic Worries

Another factor that has been contributing to the rising appeal of gold is the risk-off sentiment in stock markets. The ongoing concerns surrounding China's economic challenges and the increasing costs of borrowing have encouraged many investors to seek the safety of gold. Moving on, traders are taking a cautious approach as they await the release of the US Consumer Price Index (CPI) report and the upcoming European Central Bank (ECB) meeting.

On the flip side, the ECB faces a tough decision of either raising interest rates due to high inflation or holding off due to a weakening Euro Zone economy, and this uncertainity is adding to gold's appeal. Therefore, gold is benefiting from investor caution amid economic uncertainties in both China and Europe.

GOLD(XAU/USD) - Technical Analysis

Gold's price, currently hovering around $1,929.00, struggles to maintain a consistent breach of this level, showcasing a bearish pullback that leans on the intraday bullish trend line evident on the chart. Concurrently, the stochastic indicator is hinting at renewed positive momentum, potentially propelling the gold price to resume its upward trajectory and possibly exceed the aforementioned level, aiming for a subsequent primary target at $1,945.20.

In light of these observations, we anticipate a continuation of the bullish trend in the near term. However, it's essential to recognize that a breach below the $1,919.80 level, followed by a decline to $1,913.15, could deter the anticipated upward movement, pivoting the gold price towards a downtrend. For today, we project the gold price to oscillate between a support level of $1,913.00 and a resistance at $1,940.00.

Daily Price Outlook

The USD/JPY currency pair extended its upward rally and attracted more buying interest, pushing it above the recent levels. However, this rally can be linked to the increased demand for the US Dollar, which is providing strong support to the USD/JPY pair. It's worth noting that the upward movement is mainly driven by the emergence of USD buying, acting as a significant tailwind for the pair. Across the ocean, the worries about intervention and a cautious market mood support the Japanese yen (JPY) and limit gains for the USD/JPY pair.

USD/JPY Reacts to BoJ Governor's Comments and Policy Outlook

The USD/JPY pair initially reacted positively to Bank of Japan (BoJ) Governor Kazuo Ueda's hawkish comments, but this optimism faded quickly. Many in the market believe that the Japanese central bank will maintain its current policies until next summer. Ueda mentioned the option of ending negative interest rates if he's confident in rising prices and wages. However, Hiroshige Seko of Japan's ruling party prefers loose monetary policies. Seko noted that Ueda believes policy changes will only happen after reaching the 2% inflation target. This eases concerns about an immediate BoJ policy shift, and, coupled with some US Dollar (USD) buying, supports the USD/JPY pair.

Factors Influencing USD/JPY Pair's Direction

Apart from this, the Federal Reserve's potential future tightening of policies is boosting US Treasury bond yields and increasing demand for the US dollar (USD). Although the Fed is expected to pause its rate hikes in September, markets still think there might be one more 25 bps increase in 2023. The strong US economic data and persistent inflation suggest the Fed may maintain higher interest rates. Moving on, the upcoming US CPI report on Wednesday will be closely watched for clues on the Fed's future rate hike plans, influencing the USD/JPY pair's near-term direction.

Hence, this news is likely to exert upward pressure on the USD/JPY currency pair. The Federal Reserve's potential tightening of policies, coupled with expectations of another rate increase in 2023, is boosting demand for the US dollar (USD). (edited)

USD/JPY - Technical Analysis

The USD/JPY pair exhibited pronounced bearish activity yesterday, breaking through the 146.55 mark to touch 145.90. However, it has since oscillated around the initial level, influenced by the fading positive momentum of the stochastic indicator. Additionally, the EMA50 exerts downward pressure on the price.

Given these dynamics, we are inclined to forecast continued bearish tendencies in forthcoming sessions. It's imperative to note that our subsequent primary target stands at 145.55. Any breach beyond 146.90 would negate the anticipated decline, potentially realigning the pair with its primary bullish trajectory. Today, we project a trading range between a support level of 145.80 and resistance at 147.40.

Daily Price Outlook

The AUD/USD currency pair failed to prolong its previous upward rally and declined during Tuesday's Asian session, moving away from the four-day high it reached around 0.6450 on Monday. However, this decline was mainly due to increased demand for the US dollar. It is worth noting that investors are betting that the Federal Reserve might raise interest rates again in 2023. This coupled with a cautious market sentiment is bolstering the US dollar. Furthermore, China's economic worries and disappointing Australian consumer confidence data are also exerting downward pressure on the Australian dollar and contributes to the AUD/USD pair.

US Dollar Rebounds, Puts Pressure on AUD/USD Pair

The broad-based US dollar has recovered after a recent drop and seems to have paused its retreat from a six-month high, which is putting pressure on the AUD/USD pair. However, This is mainly because the Federal Reserve is expected to continue tightening its monetary policy, which keeps US Treasury bond yields high and supports the USD. Furthermore, the risk-off mood in the market is making the Greenback more appealing as a safe-haven currency, adding to the strain on the riskier Australian Dollar.

Investors believe the Fed will maintain higher interest rates, with some even expecting another 25 bps increase by year-end. In the meantime, the positive US economic data and reports of officials leaning toward rate hikes contribute to concerns about rising borrowing costs and dampen attraction for riskier assets like AUD.

Challenges for AUD/USD Amid Poor Aussie Confidence Data

Moreover, the AUD/USD pair faced additional pressure due to disappointing Australian consumer confidence data. In September, the Westpac - Melbourne Institute Consumer Confidence Index plunged to a dismal 79.7. This index has remained below the 100 mark since March 2022, the longest such period since the early 1990s recession. This decline comes amid growing worries about China's worsening economic conditions, suggesting the Australian dollar could face more downside risks as a China-related currency.

Traders may choose to stay cautious as they await the upcoming US consumer inflation figures set to release on Wednesday. These numbers will likely impact market expectations regarding the Federal Reserve's future rate hikes, influencing demand for the US dollar and potentially driving the AUD/USD pair's direction.

AUD/USD - Technical Analysis

The AUD/USD pair remains steadfast, maintaining its position above the 0.6400 mark, thus reinforcing the prevailing bullish outlook. The next primary target in sight stands at 0.6545. The current negative trajectory of the Stochastic indicator may temporarily impede upward momentum.

However, we anticipate a shift towards a positive momentum that could bolster the pair towards the aforementioned targets. It's crucial to note that sustaining a position above 0.6400 is pivotal for the continuation of this bullish trajectory. For today, we forecast the pair to trade within a range, with support at 0.6390 and resistance capped at 0.6490.

Daily Price Outlook

During the early European session on Monday, the EUR/USD currency pair is experiencing an uptick, hovering around 1.0730. This upward movement can be attributed to a weakening US Dollar (USD). The US Dollar Index (DXY) is currently declining, standing at approximately 104.60, despite robust performance in US Treasury yields.

Although, the US dollar is expected to maintain its strength, thanks to previously released US economic data. Market participants are awaiting the release of August's US Consumer Price Index (CPI) data scheduled for Wednesday, as it holds the potential to provide useful insights into inflation trends, which in turn can influence trading decisions involving the EUR/USD pair.

Impact of US Economic Policies on EUR/USD Currency Pair

It's worth noting that US Treasury Secretary Janet Yellen expressed confidence in the US's ability to manage inflation without harming jobs. She also mentioned that inflation is going down. This is why, Investors are expecting the Fed to raise interest rates by 25 basis points in either November or December. This could limit the EUR/USD currency pair's potential to go up.

Moreover, Fed Governor Christopher Waller mentioned that they can make changes to interest rates based on how the economy is doing. On a related note, Fed Boston President Susan Collins has cautioned against being too strict with monetary policy and advocates for a careful approach. Meanwhile, Chicago Fed President Austan Goolsbee recently talked about the Fed's goal of reaching a "golden path" where inflation decreases without causing a recession.

Thus, the potential interest rate hikes in the US could limit the upward potential of the EUR/USD currency pair by underpinning the US dollar.

ECB's Rate Expectations and China's CPI Impact on EUR/USD Sentiment

Across the ocean, the European Central Bank (ECB) is expected to keep interest rates steady in their upcoming Thursday meeting. According to recent figures from Germany, consumer prices in August closely matched expectations, with a 6.4% increase compared to the previous year. The core price index also held steady, showing a 6.1% rise.

Another factor impacting the Euro's performance was China's recent release of their Consumer Price Index (CPI) for August. The report revealed a modest 0.1% increase in prices compared to the previous year, falling short of the anticipated 0.2% rise. However, it's worth noting that this is an improvement from the previous month when prices actually dropped by -0.3%.

Traders are closely watching China's economic situation, looking for clues about the challenges that Chinese authorities are dealing with. The market anticipates that Beijing will introduce more monetary and fiscal measures to help achieve their goal of reaching a 5% GDP growth rate for the current year.

EUR/USD - Technical Analysis

The EUR/USD pair has initiated today with an upward trajectory, distancing itself from the 1.0700 threshold. Current indications from the stochastic oscillator suggest a positive convergence, leading us to anticipate potential gains in the forthcoming sessions. The immediate target is set at 1.0785; a breach of this level could further propel the pair towards the 1.0880 region in the short term.

It's pivotal to mention that if the pair struggles to surpass 1.0785, it may revert to its primary bearish course. Conversely, a descent below the 1.0700 mark would nullify our projected bullish outlook, inducing a decline. For today's trading, we forecast the EUR/USD to oscillate between a support level of 1.0650 and a resistance at 1.0810.

Daily Price Outlook

The Gold price (XAU/USD) has successfully recovered from its losses of the previous week and is currently trading around $1,930. However, this rebound is mainly attributed to the weakening of the US Dollar, which makes gold more appealing. However, the USD's decline is linked to hints from Federal Reserve (Fed) policymakers suggesting they won't raise interest rates in the upcoming September meeting. In the meantime, the ongoing worries about China's economic slowdown were seen as one of the key factors that kept the lid on any additional gains in the Gold price.

US Dollar's Impact on Gold Prices and Upcoming Economic Factors

The broad-based US dollar lost some of its traction and faced losses during the Asian trading session on Monday. However, the reason for its decline can be attributed to the prospects that Federal Reserve policymakers won't raise interest rates in the upcoming September meeting. Thus, the bearish US dollar was seen as one of the key factors that boosted the Gold price, at least for the time being.

However, the losses in the US dollar could be short-lived, thanks to consistently positive economic news from the United States. Investors are closely watching the release of the Consumer Price Index (CPI) data for August, scheduled for Wednesday. This data will provide valuable insights into the country's inflation situation.

At the same time, investors are also considering the possibility of the Federal Reserve (Fed) raising interest rates by 25 basis points in either their November or December meetings. This "hawkish" stance could provide some support for the price of precious metals like gold.

It's also important to mention that Janet Yellen, the US Treasury Secretary, believes that the US can manage inflation without hurting job growth. She thinks everything is pointing towards lower inflation. On top of that, Austan Goolsbee, the President of the Chicago Fed, talked about the Fed's goal. They want to steer the economy onto a "golden path," which means finding a careful balance where inflation goes down but doesn't lead to a recession. This news may have eased concerns, possibly lowering gold prices as it suggests inflation control without a recession.

China's CPI Report Impacts Gold, Eyes on Beijing's Growth Goal

Across the ocean, the release of China's weaker-than-expected Consumer Price Index (CPI) for August may have had a negative impact on gold prices. The report, which came out on a Saturday, revealed a modest 0.1% annual increase, falling short of the expected 0.2% rise. However, it's worth noting that this represented an improvement compared to the previous month's -0.3% figure.

Looking forward, market traders will keep thier eye on the hurdles faced by Chinese authorities in their efforts to implement the monetary and fiscal actions needed to reach Beijing's target of a 5% GDP growth rate this year. Hence, these efforts could influence not only China's economic stability but also global financial markets, including the price of gold.

GOLD(XAU/USD) - Technical Analysis

The price of gold experienced a notable decline upon encountering a robust resistance at $1,929.00. However, today's market opening indicates an upward trajectory, as the commodity seeks to resume its optimistic inclinations. A successful breach of the aforementioned resistance would pave the way for an ascent towards a primary target of $1,945.20.

Given these dynamics, our projection maintains a bullish orientation for the foreseeable future. The stochastic oscillator is poised for a favorable convergence, which further accentuates the optimistic outlook. It's essential to highlight that a breach below $1,913.15 would negate this bullish sentiment, potentially initiating a downward reversal in price. For today's trading, we anticipate gold to fluctuate within a range bounded by a support at $1,913.00 and resistance at $1,940.00.

Daily Price Outlook

During the Asian trading session on Monday, the GBP/USD currency pair managed to recover from a three-month low. However, the recovery was driven by a modest decline in the US dollar, which had previously reached a multi-month high. The British pound gained strength against the US dollar because the dollar weakened slightly, prompting traders to place strong position.

Hawkish BoJ Comments and Mixed Chinese Data Impacting GBP/USD

It is worth noting that the Bank of Japan's (BoJ) Governor Kazuo Ueda made some hawkish remarks over the weekend, boosting demand for the Japanese Yen (JPY) and putting pressure on the US Dollar (USD). Additionally, a positive vibe in the stock markets pulled the safe-haven US dollar away from its highest level since March, which supported the GBP/USD pair.

Over the weekend, data showed that China's consumer prices rose in August, and the Producer Price Index decline slowed down. This suggests that China's economy might be stabilizing after a rough patch this year. Investors are also hopeful for more stimulus from China. However, some indicators show that China's manufacturing is still struggling, and the growth in the services sector is slowing down. This mixed economic picture could temper market optimism.

Hence, the hawkish BoJ comments boosted the Japanese Yen and pressured the US Dollar, aiding the GBP/USD pair.

Central Bank Actions Impacting GBP/USD

Across the ocean, the belief that the Federal Reserve (Fed) will stick to its tougher stance is likely to restrain the US Dollar's fall and limit GBP/USD gains. Market players think the Fed will keep interest rates high for a while. Some officials even suggest raising rates more than needed, boosting US Treasury bond yields and supporting the USD.

Meanwhile, Bank of England (BoE) Governor Andrew Bailey warned about ongoing high inflation, hinting at more rate hikes. However, he also hinted that the BoE might be close to stopping rate hikes. This may hinder any significant rise in GBP/USD, at least for now.

GBP/USD - Technical Analysis

The GBP/USD pair is revisiting the 1.2505 mark. Recent higher lows observed indicate a potential ascent in the upcoming trading sessions. If the pair exceeds the aforementioned level, it is poised to approach 1.2625.

Today's outlook is inclined towards a bullish trend, bolstered by favorable indications from the stochastic oscillator. It's important to note, however, that if the pair cannot surpass the 1.2505 threshold, it might revert to its predominant bearish trajectory with an aim towards 1.2395.

We project the GBP/USD's trading spectrum for the day to span between a 1.2430 support and a 1.2590 resistance. The day's anticipated trend is bullish.

Daily Price Outlook

The EUR/USD currency pair managed to halt its previous losing streak and garnered some buying interest during the Asian session on Friday, reversing a significant portion of the prior day's decline, which had taken it to the 1.0685 region, a three-month low. However, this upward movement was largely fueled by the mild weakness in the US dollar. On the contrary, the potential for the Federal Reserve to continue raising interest rates could limit the substantial gains for the Euro (EUR) against the US dollar.

USD Retreats Amid Profit-Taking and Rate Hike Expectations

The broad-based US dollar has retreated from recent highs as investors take profits ahead of China's inflation data and the G20 leaders summit. This decline is driven by lower US Treasury bond yields and a steadier stock market, reducing demand for the safe-haven US dollar. However, the dollar may not fall significantly because the Federal Reserve (Fed) plans to keep raising interest rates, which supports bond yields. Strong US jobless claims and positive economic data indicate a robust US economy, reinforcing the Fed's rate hike strategy.

This suggests the EUR/USD pair could experience some upward pressure due to the weaker US dollar stemming from improved market sentiment. Still, potential rate hikes by the Federal Reserve could limit significant gains for the Euro (EUR) against the US dollar (USD).

Mixed Signals from ECB and Upcoming Data

On the flip side, European Central Bank (ECB) officials have given mixed signals regarding future interest rate increases. While Slovak policymaker Peter Kazimir supports a rate hike in September due to high inflation, ECB Governing Council member Ignazio Visco believes the ECB is nearing a point where it should stop raising rates. This uncertainty could discourage traders from making strong bullish bets on the Euro (EUR) and may limit significant gains for the EUR/USD pair, as the lack of clarity from the ECB affects market sentiment and expectations for the Euro's performance against the US dollar.

Looking forward, traders will pay attention to German CPI data and French Industrial Production figures for market direction. No significant US economic data is expected, so the US dollar's fate depends on bond yields and overall market sentiment. The EUR/USD pair is likely to continue its eight-week losing streak, with a downward trend expected due to uncertainty ahead of the important ECB meeting next week.

EUR/USD - Technical Analysis

The EUR/USD currency pair has firmly established support at the 1.0700 threshold, currently exhibiting a mild upward tendency, influenced by positive stochastic readings. There's potential for the pair to approach and test the pivotal 1.0785 resistance level before anticipated retracement.

The descending channel remains a dominant force in dictating the primary bearish trajectory, with the EMA50 consistently reinforcing this movement. The overarching bearish outlook remains intact for the foreseeable future unless the currency manages to breach and sustain above the 1.0785 mark. It's worth noting that our subsequent significant objective is pegged at 1.0635.

Today's trading range is projected between the support at 1.0635 and resistance at 1.0785.

Daily Price Outlook

Gold prices (XAU/USD) have continued their upward momentum, bouncing back from a recent one-week low of approximately $1,915. They have surged by over 0.30% in the current trading day and are currently hovering around the $1,925-$1,926 range. However, the upward rally could be associated with the growing concerns regarding a potential global economic downturn and the deteriorating relations between the United States and China, which have prompted some investors towards the gold.

Gold Gains Amid Global Economic Worries and US-China Tensions

It is worth noting that China's recent ban on officials using iPhones for work and US Secretary of Commerce Gina Raimondo's stance that tariffs on China won't change until a Treasury review are adding to the unease. These factors are making investors cautious, and driving up demand for gold as a safe-haven asset, leading to its price increase.

It should be noted that the ongoing uncertainty surrounding China's economic conditions, as well as downward revision of Japan's second-quarter GDP growth, has fueled worries about the possibility of a more global economic slowdown. As a result, investors are increasingly turning to gold as a safe-haven asset in the midst of these uncertainties.

Weaker US Dollar Boosts Gold Amid Fed's Hawkish Stance

Moreover, the slightly weaker US Dollar is providing an additional boost to the Gold price. As we mentioned earlier, investors are increasingly seeking safe havens, resulting in a drop in US Treasury bond yields. Consequently, traders are scaling back their bullish positions on the USD, particularly following its recent climb to the highest level since March 9. Hence, the softer Dollar typically drives up demand for commodities priced in USD, such as gold.

However, there is a growing consensus that the Federal Reserve (Fed) will maintain its hawkish stance, keeping interest rates elevated for an extended period. This anticipation could potentially put a cap on the upward momentum for XAU/USD.

Looking ahead, investors will remain cautious as they await China's inflation data and the upcoming G20 leaders summit this weekend. In the meantime, the overall market sentiment will continue to play a crucial role in influencing Gold's short-term movements.

GOLD(XAU/USD) - Technical Analysis

The gold price began today's trading on a notably positive note, breaking free from the recent intraday bearish constraints. It is now on course to achieve anticipated gains in the forthcoming sessions. Key milestones include surpassing the $1,929 mark, which would signify a trajectory towards $1,945.20 as the next primary target.

Thus, a bullish outlook is forecasted for today, bolstered by optimistic stochastic indicators. It's crucial to note that maintaining above the $1,929 level is pivotal for this bullish wave. Failure to do so could counteract this positive trend and result in a price pullback.

Today's anticipated trading range lies between a support of $1,915 and a resistance of $1,945.

Daily Price Outlook

The global market sentiment unable to stop its bearish trend and remains negative, thanks to the ongoing worries about the Federal Reserve's hawkish stance and issues in China. Notably, the S&P 500 Futures have been declining for four consecutive days, currently sitting at their lowest level in a week at around 4,468.

Meanwhile, the US 10-year Treasury bond yields hover around 4.30%, near the recent high of 4.29%, while the two-year bond yields have dropped from their weekly peak to 5.01%, marking their first daily loss in four days. Hence, the market is facing a bearish trend, with no signs of improvement due to fears of slower economic growth and recession in China.

Moving on, traders are keeping an eye on China's foreign trade data for August and speeches from several Federal Reserve officials. However, worries about economic slowdowns in China, the Eurozone, and the UK are conflicting with concerns about a soft landing in the US. This contrast is maintaining a risk-off sentiment in the market.

Global Economic Concerns Impact Investor Sentiment

It is worth noting that the recently released disappointing Caixin Services PMI in China, coupled with uncertainties surrounding China's stimulus efforts, have heightened concerns about a potential economic downturn in Beijing. Furthermore, escalating tensions between the United States and China regarding trade and Taiwan are further fueling the risk off sentiment in the market.

Meanwhile, the economic reports from the Eurozone and the United Kingdom indicate a downbeat economic outlook. This is making investors even more cautious. Thus, these factors are contributing in risk-off sentiment in the market, with investors opting for lower-risk options.

China's Economic Measures and Global Tensions Impact Investor Confidence

As we all are well aware China has been taking steps to boost its struggling economy after facing challenges during the pandemic. However, they have implemented various policies, and more are expected soon. Nevertheless, investor confidence is still low because of worries about China's weakening economy and the ongoing trade disputes with the United States.

These concerns might reduce the demand for precious metals. In the meantime, the G20 leaders' summit is happening this Saturday in New Delhi. President Joe Biden will attend, but Chinese President Xi Jinping won't be there. This exacerbates the already damaging relationship between the two superpowers countries.

Strong US Economic Data Drives Dollar Confidence

The US Dollar Index (DXY), measuring the US dollar's performance against other major currencies, is hovering around 104.90, near its highest level since April. This is driven by positive news about the US economy, including lower-than-expected Initial Jobless Claims at 216K (compared to an expected 234K) and an increase in Unit Labor Costs to 2.2% for the second quarter, in line with expectations. Thereby, investors expect a more hawkish approach from the US Federal Reserve with expected interest rate hikes of 25 basis points in November and December. This bolstering market sentiment and confidence in the US economy.

S&P500 (SPX) - Technical Analysis

The technical outlook for the S&P 500 presents a captivating picture. While there have been slight variations akin to light rain, the $4400 level captures my focus. A detailed look indicates the 50-day exponential moving average providing solid resistance around $4475.

What stands out is the affirmation from candle closures below this mark, indicating a potential downward trend. Examining the technical metrics, both the relative strength index and the moving average convergence divergence indicators remain stable in the sell zone, hinting chances of a bearish movement.

Furthermore, the S&P 500 showcases the potential to target the $4390 mark. Achieving this could set the stage for the next target at $4350. On the flip side, bullish cross above $4475 might push the index towards the $4500 or $4545 areas. Given these insights, it's wise to stay alert and consider a selling around the $4475 mark for the day.

Daily Price Outlook

During the Asian trading session on Thursday, the USD/JPY currency pair continued its upward movement, reaching levels not seen since November 2022, trading within the range of 147.80 to 147.85. This uptrend is primarily attributed to the strength of the US dollar, which is currently near its highest point in six months. However, the driving factor behind this strength is the growing anticipation of further interest rate hikes by the Federal Reserve.

On the other side, there are concerns about potential currency intervention by Japanese authorities, and overall market sentiment remains cautious. This caution is leading investors to seek the safety of the Japanese yen (JPY), acting as a safe-haven currency. As a result, the substantial advances in the USD/JPY pair are somewhat limited.

Strong US Economic Data Boosts USD/JPY Pair

The broad-based US dollar is gaining traction and remained strong, reaching a six-month peak following the release of encouraging US economic data. This robust performance is notably boosting the USD/JPY pair. The US Institute for Supply Management (ISM) Services Purchasing Managers' Index (PMI) for August exceeded even the most optimistic predictions, surging to 54.5, marking the highest level since February. A deeper look into the report reveals an increase in new orders and businesses reporting higher prices, indicative of a resilient US economy and persistent inflation pressures.

These developments have boosted the prospect of the Federal Reserve (Fed) implementing an interest rate hike in November. Hence, the expectation that the Fed will maintain higher rates for an extended period is underpinning elevated US Treasury bond yields and providing further support to the US dollar and contributes to the USDJPY pair gains.

JPY Underperforms Due to BoJ's Dovish Stance and Intervention Fears

Across the ocean, the Japanese Yen (JPY) is struggling due to the Bank of Japan's (BoJ) persistent commitment to loose monetary policies, which discourages bullish positions on the USD/JPY pair. There's also concern that Japanese authorities might intervene in the forex markets to strengthen the JPY. Japan's top currency diplomat, Masato Kanda, issued a warning about the JPY's depreciation and the possibility of measures against speculative activities.

This, along with a cautious equity market sentiment, boosts the JPY's safe-haven appeal and limits USD/JPY pair gains. In the meantime, investors seems worried about rising borrowing costs and a slowdown in China, reducing appetite for riskier assets.

USD/JPY - Technical Analysis

The USD/JPY pair encountered a brief downtrend, touching the 147.00 barrier, before regaining momentum in an attempt to continue its anticipated bullish trajectory in both the intraday and short-term scopes.

The positive forecast remains grounded, bolstered by the EMA50 which underpins the price. It's essential to note that a breach of the 146.55 level might instigate a temporary bearish correction before the price ascends once more.

For today, the projected trading spectrum is demarcated between the support at 147.00 and the resistance at 148.40