Four days passed without anything happening, and on the fifth day everything moved during the week
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▼ How to sum up this week in one line
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From Monday to Thursday, the USD/JPY hardly moved.
But on Friday, a single comment completely turned everything around.
That’s all for this week. Let’s go through it in order.
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▼ ① Mon–Thu didn’t move due to a “tug of war”
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Around the dollar-yen pair, there were two kinds of people.
【People who want to sell at around 160.00 yen】
After it rose to 163.97 yen at the end of July, the governments of Japan and the United States intervened together
to push it down to 155.22 yen. About half to 60% of the decline
was retraced back to around 160 yen.
This level is also watched for a possible resumption of intervention, so
it’s a place where people who want to sell are waiting.
【People who want to buy if it falls】
Meanwhile, the long-term daily trend is still upward.
The longer-term support (200-day moving average) is also pointing up.
Therefore, people who want to buy on a decline are staying on the sidelines.
These two groups were evenly matched, so for four days it stayed around 159 yen with little movement.
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【This is the most important part for beginners】
“Not moving = no opportunity” does not apply; instead,
“Not moving = there is no reason to enter.”
There are days when doing nothing is the correct choice.
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▼ ② Friday, the scenery changed completely
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On August 28 (Friday), there was the Jackson Hole meeting,
a conference where central bank leaders from around the world gathered.
Here, Fed Chair Jerome Powell said
・“The 2% inflation target will not be moved under any circumstance”
・“If the pace of price declines slows, there are still measures to take”
・“The possibility of further rate hikes cannot be ruled out”
and the market, which had been expecting less hawkishness, became much more hawkish.
That is, more inclined to raise interest rates.
Then this chain reaction occurred.
U.S. rates seem likely to rise
↓
Holding dollars becomes advantageous
↓
Everyone buys dollars and sells yen
↓
USD/JPY rises = surges to around 160.15 yen
In fact, the probability of a rate hike in September jumped from 35% to around 60%,
and the U.S. two-year yield rose by about 0.13%.
USD/JPY recovered to the 160-yen range after the coordinated intervention.
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▼ ③ Here, the plan to “sell” became void
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We had prepared a scenario to sell from 160 yen, using the high on the 25th as a double top.
But since it rose past 160 yen on Friday,
the premise of that sell-off was invalidated.
What’s important here is — we prepared, but
we did not actually enter the market.
★ If you don’t enter, you won’t incur losses even if the premise collapses.
You can wipe the slate clean and reorganize your plan.
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