USD/JPY Forecast: Limited bullish scope, still at risk of falling towards 103.50
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UNLOCK OFFERUSD/JPY Current price: 104.34
- The greenback advanced on the back of profit-taking, remains weak.
- US equities spent the day in the red, US Treasury yields ticked modestly higher.
- USD/JPY has recovered some ground, but there are no signs of an upcoming bullish extension.
The USD/JPY pair traded as low as 104.38 this Monday, as the greenback started the week with the back foot, falling against most of its major rivals. The tide changed with London’s fix, as profit-taking lifted the dollar. The pair ignored the poor performance of Wall Street, as the three major US indexes spent the day in the red. US Treasuries provided little directional clues holding around Friday’s closing levels.
Japan published the preliminary October Industrial Production estimate, which was up 3.8% MoM, slightly below expected, and down by 3.2% YoY, much better than anticipated. October Retail Trade in the country surged by 6.4% YoY against the expected -7.7%. The country also published October Housing Starts, which declined 8.3% YoY, slightly better than expected. Early Tuesday, Japan will publish the October unemployment rate and the November Jibun Bank Manufacturing PMI, foreseen unchanged from the preliminary estimate at 48.3.
USD/JPY short-term technical outlook
The USD/JPY pair trades near a daily high of 104.38, but its bullish potential is limited. The 4-hour chart shows that the pair is trading below a directionless 100 SMA but has managed to recover above its 20 SMA. Technical indicators have corrected from daily lows but lost directional strength around their midlines and are now flat. Bulls can have better chances if the pair breaks above 104.65, the immediate resistance level.
Support levels: 103.90 103.50 103.15
Resistance levels: 104.65 105.00 105.40
View Live Chart for the USD/JPY
USD/JPY Current price: 104.34
- The greenback advanced on the back of profit-taking, remains weak.
- US equities spent the day in the red, US Treasury yields ticked modestly higher.
- USD/JPY has recovered some ground, but there are no signs of an upcoming bullish extension.
The USD/JPY pair traded as low as 104.38 this Monday, as the greenback started the week with the back foot, falling against most of its major rivals. The tide changed with London’s fix, as profit-taking lifted the dollar. The pair ignored the poor performance of Wall Street, as the three major US indexes spent the day in the red. US Treasuries provided little directional clues holding around Friday’s closing levels.
Japan published the preliminary October Industrial Production estimate, which was up 3.8% MoM, slightly below expected, and down by 3.2% YoY, much better than anticipated. October Retail Trade in the country surged by 6.4% YoY against the expected -7.7%. The country also published October Housing Starts, which declined 8.3% YoY, slightly better than expected. Early Tuesday, Japan will publish the October unemployment rate and the November Jibun Bank Manufacturing PMI, foreseen unchanged from the preliminary estimate at 48.3.
USD/JPY short-term technical outlook
The USD/JPY pair trades near a daily high of 104.38, but its bullish potential is limited. The 4-hour chart shows that the pair is trading below a directionless 100 SMA but has managed to recover above its 20 SMA. Technical indicators have corrected from daily lows but lost directional strength around their midlines and are now flat. Bulls can have better chances if the pair breaks above 104.65, the immediate resistance level.
Support levels: 103.90 103.50 103.15
Resistance levels: 104.65 105.00 105.40
View Live Chart for the USD/JPY
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