USD/JPY analysis: no directional clues with the US on holiday
|USD/JPY Current price: 109.63
- Japanese trade deficit foreseen shrinking to ¥29.5B in December.
- Risk aversion could return after European indexes hinted so by closing in the red.
The USD/JPY pair spent most of this Monday lifeless in the 109.60 price zone, amid a US holiday which left investors clueless. The pair eased during Asian trading hours, as Chinese Q4 GDP revived concerns about global growth, coming in as expected, although confirming that the world's second-largest economy grew at its slowest pace in almost three decades during 2018. There were no macroeconomic data releases in Japan, although the country will release early Tuesday, December trade data. Market analysts expect the deficit to shrink sharply from the previous ¥-737.3B. Ahead of the Asian opening, the only clue the market has is a modest side in European indexes, hinting a negative mood that could support the yen.
From a technical point of view, the pair holds on to its positive stance but having lost the upward momentum, as the pair keeps trading above its 100 SMA but still below the 200 SMA which heads lower around 110.70. Technical indicators in the mentioned chart remain directionless well above their midlines and barely retreating from their daily highs. A steeper recovery will likely come once stops get triggered beyond 110.00, while the risk will probably turn back south if the pair losses 109.05, a strong Fibonacci support.
Support levels: 109.40 109.05 108.65
Resistance levels: 110.00 110.45 110.90
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