USD/JPY pressures weekly highs, poised to advance towards 106.25
|The USD/JPY pair continues to trade around 105.40, nearing its weekly high at 105.54. A break above the latter would open the door for a run towards 106.25, FXStreet’s Chief Analyst Valeria Bednarik reports.
Key quotes
“According to the latest headlines, Treasury Secretary Steven Mnuchin and House Speaker Nancy Pelosi have agreed to restart formal talks on a second round of stimulus. House Democrats are putting together another coronavirus relief package, which would cost about $2.4 trillion. The positive sentiment, however, seems to be fading in the London session, as stocks plummet and the greenback gathers momentum against most major rivals.”
“Japan published the August Corporate Service Price Index, which came in at 1% YoY, below the 1.4% expected. The focus now shifts to US Durable Goods Orders, foreseen at 1.5% in August, down from 11.4% in July.”
“The risk is skewed to the upside, according to the 4-hour chart, as the 20 SMA maintains its bullish slope, and surpassed the 50% retracement of the mentioned decline. The 100 SMA, however, maintains a modest bearish slope, providing a dynamic resistance around the mentioned high. Technical indicators, in the meantime, remain within positive levels, slowly grinding higher.”
“A clear break of the weekly high at 105.54 should favor an extension towards the 106.25, where the pair would complete a 100% retracement.”
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