USD/JPY Forecast: Bulls retain control in a slow trading day
|USD/JPY Current price: 109.16
- Japanese data disappointed, keeping yen’s gains in check despite mounting risk-aversion.
- US President Trump signed the Hong Kong human rights act, angering Beijing.
- USD/JPY bullish in the short-term, but lack of volumes likely to keep it ranging.
The market is extremely quiet this Thursday, with major pairs still confined to familiar levels. The USD/JPY pair, which rose to 109.60, a 6-month high, is currently trading around 109.45. Japanese data released at the beginning of the day missed the market’s expectations as Retail Trade fell by 14.4% in October, much worse than the 0.0% expected. When compared to a year earlier, Retail Trade was down by 7.1%. Large Retailers’ Sales were also sharply lower, down by 8.2% in the same month. Given that the US celebrates Thanksgiving, there won’t be macroeconomic releases in the country today.
In the trade war front, US President Trump signed the Hong Kong human rights act, supporting the protest movement, angering Beijing. Trade talks weren’t interrupted, yet the headline triggered a cautious stance that keeps Asian and European indexes in the red.
USD/JPY short-term technical outlook
The USD/JPY pair retains its bullish stance according to intraday technical readings and has room to extend its rally toward 110.00, although chances of that happening in the near-term are quite limited. In the 4-hour chart, the pair is developing above all of its moving averages, with the 20 SMA advancing firmly above the larger ones. Technical indicators, in the meantime, remain near weekly highs, the RSI resting above its 70 line.
Support levels: 109.30 109.05 108.80
Resistance levels: 109.60 109.90 110.10
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