USD/JPY Current price: 106.44
- The positive tone of equities and a bounce in government bond yields keeping the pair afloat.
- FOMC Meeting Minutes expected to have a limited impact ahead of Jackson Hole.
- USD/JPY to resume its decline on a break below 106.05, a Fibonacci support.
The USD/JPY pair is trading lifeless in a 50 pips’ range just below a critical Fibonacci resistance ever since the week started, as, despite some back and forth in the market’s sentiment, safe-haven assets continue to be demanded in an uncertain environment. This Wednesday, equities are performing better in Europe, pushing US futures up ahead of the opening. Government bond yields ticked higher, although the yield for the benchmark 10-year Treasury note is at 1.58% up from a monthly low of 1.47% but well below the 2.06% it hit at the beginning of August.
Japan didn’t release relevant data this Wednesday, which exacerbated the quietness around the pair. The market is now waiting for the release of the FOMC Meeting’s Minutes. The statement is usually scrutinized in search of clues about the future of the monetary policy. This time, the document may have a limited effect on the dollar, as the meeting took place before the latest escalation of the trade war, which is among US policymakers major concerns, and also below some encouraging data released last week, included upbeat Retail Sales. Furthermore, Fed’s head, Jerome Powell is scheduled to speak this Friday within the Jackson Hole Symposium and will probably provide more updated cues.
USD/JPY short-term technical outlook
The USD/JPY pair is technically neutral, according to the 4 hours chart, as it’s stuck between the 20 and 100 SMA, with the largest maintaining its downward slope just above the current level. Technical indicators hover just above their midlines, without directional strength. The 106.65 price zone, where it has the 38.2% retracement of its latest daily decline, has capped advances since the week started, quite a relevant resistance. The 23.6% retracement of the same slide comes at 106.05, providing support.
Support levels: 106.05 105.60 105.25
Resistance levels: 106.65 106.95 107.20
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
EUR/USD regains traction, recovers above 1.0700
EUR/USD regained its traction and turned positive on the day above 1.0700 in the American session. The US Dollar struggles to preserve its strength after the data from the US showed that the economy grew at a softer pace than expected in Q1.
GBP/USD returns to 1.2500 area in volatile session
GBP/USD reversed its direction and recovered to 1.2500 after falling to the 1.2450 area earlier in the day. Although markets remain risk-averse, the US Dollar struggles to find demand following the disappointing GDP data.
Gold climbs above $2,340 following earlier drop
Gold fell below $2,320 in the early American session as US yields shot higher after the data showed a significant increase in the US GDP price deflator in Q1. With safe-haven flows dominating the markets, however, XAU/USD reversed its direction and rose above $2,340.
XRP extends its decline, crypto experts comment on Ripple stablecoin and benefits for XRP Ledger
Ripple extends decline to $0.52 on Thursday, wipes out weekly gains. Crypto expert asks Ripple CTO how the stablecoin will benefit the XRP Ledger and native token XRP.
After the US close, it’s the Tokyo CPI
After the US close, it’s the Tokyo CPI, a reliable indicator of the national number and then the BoJ policy announcement. Tokyo CPI ex food and energy in Japan was a rise to 2.90% in March from 2.50%.