USD/JPY Forecast: Uncertainty keeping investors away
|USD/JPY Current Price: 107.53
- The number of coronavirus cases approaches a global total of 12 million.
- Japan will publish this Wednesday the June Eco Watchers Survey.
- USD/JPY is comfortable at around 107.50 and unable to attract investors.
The USD/JPY pair is ending a fourth consecutive day around the 107.50 level, unable to leave its comfort zone in a risk-averse environment. The high levels of uncertainty related to the future of major economies are behind the pair’s lack of direction these days, as the ongoing pandemic gives no sign of receding. Instead, the number of global cases approaches to 12 million, while countries that had reopened early are establishing partial lockdowns amid new outbreaks.
In the data front, Japan published at the beginning of the day the preliminary estimate of the May Leading Economic Indicator, which unexpectedly improved to 79.3 from 77.7, better than the 73.2 expected. The Coincident Index, for the same period, however, contracted to 74.6 from 80.1. The country also published Overall Household Spending, down by 16.2% in the year to May. This Wednesday, Japan will publish its May Trade Balance and the Current account for the same month, while later into the session, it will unveil the June Eco Watchers Survey.
USD/JPY short-term technical outlook
The USD/JPY pair maintains its neutral stance in the short-term, hovering around the 38.2% retracement of its latest daily decline at 107.50. In the 4-hour chart, moving averages remain directionless, with the pair currently converging with the 20 and 200 SMA. The 100 SMA, stands at around 107.20, providing an intraday dynamic support- Technical indicators in the meantime, remain stuck around their midlines. The pair has better chances of rallying on a break above 107.95, the immediate resistance.
Support levels: 107.20 106.95 106.60
Resistance levels: 107.95 108.30 108.65
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