Ukraine crisis & rate hikes sending USD, oil higher

USD/JPY => The pair rises to a six-year high
Adobe => The stock trades down 20% this year
Oil => The commodity rises above $110

USD/JPY climbs over 120.00 after Powell comments

USD/JPY rallied 0.15% in the previous session and is building on today’s gains.

The USD is surging higher after Federal Reserve Chair Jerome Powell reiterated his hawkish message from last week, confirming that the Fed plans to take the action needed to bring inflation down. He reassured that the US central bank could opt to hike rates by more than 0.25% at one or more of the meetings this year.

In the FOMC meeting last week, the Fed hikes rates by 0.25%. The Fed’s position is in sharp contrast to the BoJ, which stuck with its accommodative stance last week. Central bank divergence has lifted the pair to a fresh six-year high.

Where next for USD/JPY?

USD/JPY trades above its steep 2-week rising trendline, and above its rising 50 & 100 trendlines.

The chart is bullish. The only bearish signal is the RSI which is firmly into overbought territory. There could be a period of consolidation or a move lower before further gains.

Buyers will be looking towards resistance at 121.00 round number ahead of 121.70 (2016 high). Support could be found at 119.55 today’s low and yesterday’s high. It would take a move below 118.50 to negate the near-term uptrend.

Adobe Q1 earnings preview

Adobe will release Q1 2022 results today, after the market close.

Expectations are for EPS of $3.34 on revenue of $4.24 billion, which would mark an 8.5% YoY gain. In December, Adobe forecast Q1 and full-year 2022 numbers that fell short of analysts’ estimates, as the firm blamed a stronger USD against other currencies.

Adobe has been a dominant force in digital design software for professionals. However, competition is picking up as it offers tools for users to make graphics, videos, and other content.
Heading towards earnings, the share price has fallen 20% in 2022 alone, underperforming the NASDAQ.

Oil roars higher

Oil prices jumped 7% yesterday and continue to rise today. Concerns grew that the EU could impose restrictions on Russian oil as the US did at the start of the month.

European leaders’ support for a Russian oil ban is growing, which represents a significant shift in stance, while the West looks to ramp up pressure on Russia.
While a rapid agreement to ban Russian oil is still a long way off, the move that was once considered unthinkable is now on the table and at least open to discussion.

Meanwhile, Russia intensifies its attacks on Ukraine and peace talks show few signs of progress. Today, Russian developments will be in focus, in addition to API inventory stockpile data.

Support can be found at 108.50 (high March 11) and 105.00 (high 18 March).

Resistance for the pair can be seen at 114.70 (low 18 March) and 125.40 (March 9 high).

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