General Trend is Still Bullish

• The bulls still control the direction of the USD/JPY currency pair, in light of the continuation of the bearish pressure on the Japanese yen.
• The gains of this trend reached the resistance level of 135.15, and it settles around the level of 134.70 at the time of writing the analysis.
•  The US central bank still wants to stress the opposite of the Japanese central bank and despite the new leadership the stimulus will remain for a long time.

Elsewhere, US mortgage rates rose last week by the most in two months to 6.43%, reducing already stagnant demand. Mortgage Bankers Association data on Wednesday showed the contract rate on a 30-year fixed rate mortgage rose 13 basis points, abruptly ending a five-week decline in borrowing costs. The group’s index of mortgage applications for home purchases fell 10% in the week ended April 14, the biggest decline in two months.

Not only have higher borrowing costs — now higher — stifled buyer activity over the past year, but they also discouraged many Americans from listing their homes in the first place, straining inventory and further limiting sales. With the Federal Reserve set to tame inflation, and the prospect of higher US interest rates, it is not clear when the housing market will be able to regain momentum.

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The MPA index of refinancing applications also fell to the lowest level since early March. It is a survey conducted weekly since 1990, using responses from mortgage bankers, commercial and savings banks. The data covers more than 75% of all residential mortgage applications for individuals in the United States.

According to the performance on the daily chart below, the price of the USD/JPY currency pair is settling inside an ascending channel.  It is breaking the resistance 135.35 is important to provide a strong momentum for the bulls, thus preparing for stronger bullish breaches. At the same time, upward hopes will evaporate if the currency pair returns to the vicinity of the 132.75 support level. In general, I still prefer to buy the currency pair from every downward level. The US dollar will be affected today by the announcement of the number of weekly jobless claims, the reading of the Philadelphia Industrial Index, the existing US home sales, and more from statements by policy officials of the US Federal Reserve Bank.

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