USDJPY: Can it confirm the minimum value


■ US employment data for February showed that the unemployment rate is expected to continue to fall and wages will continue to rise even as job growth slows.
■ After the USD/JPY paused at 138 yen, it is worth paying attention to whether the price of 135 yen bottoms out and moves upward

    Regarding the U.S. employment statistics for February, which will be released at 22:30 on the 10th, Japan time, the number of non-agricultural employment (NFP) increased by 205,000 from the previous month, which is lower than the growth of 517,000 in the previous month. Growth is expected to slow down. Affected by many special factors such as revisions at the beginning of the year and large-scale strikes in January, wages will increase by 4.7% year-over-year, and the growth rate will accelerate, and the tight labor market may continue.
    In the currency market, the US Federal Open Market Committee (FOMC) raised the policy rate by 0.50% to 5.00-5.25% at its March 21-22 meeting, which is expected to be around 54%. Most people believe that the final destination of the policy rate (terminal rate) will reach 5.25-5.50% or 5.50-5.75%. Will exceed FOMC participants' policy rate forecasts for the end of 2023 as of December (median: 5.00-5.25%). Federal Reserve (Fed) Chairman Jerome Powell testified before Congress on the 8th and 9th that he will carefully monitor employment data and inflation indicators and decide whether to accelerate the pace of interest rate hikes again. The release of inflation indicators such as prices on the 14th and the producer price announcement on the 15th will also have to wait.
    Since December 20, 2018, the USD/JPY exchange rate has generally remained flat at 127-135 yen and then continued to go down and up, returning to the support line of 135 since February 24. If we regard this trend as a "dish bottom" pattern, the strong US dollar and weak yen will slow down to a high of 137.91 yen on the 8th, forming a bottom of about 135 yen, forming a platform and cross-holding may continue. If the "bottom" pattern breaks above the neckline (high) of the 135–138-yen platform based on February employment data and inflation indicators, we will be able to confirm a deep bottom for the dollar.