USD/JPY Current price: 105.72
- China steepens the negative sentiment after accusing the US of violating the consensus.
- US Retail Sales could give the greenback a short-lived boost, sentiment to overshadow it all.
- USD/JPY to accelerate its decline on a break below 105.50, the immediate support.
The USD/JPY pair is stable just below the 106.00 figure, although the pair peaked at 106.77, a short-lived spike at the beginning of the European session that can be attributed to thin volumes due to several local holidays.
The Dow Jones Industrial Average lost roughly 800 points Wednesday, the largest one-day drop this year, amid fears of a US recession, with the negative sentiment spreading into Asia and now Europe, playing in favor of the Japanese yen. The negative mood steepened after China stated that the latest US announcement of tariffs, included the delay to December, violates the consensus reached in Osaka.
Japanese data surprised to the upside, although resulted far from encouraging. According to the official announcement, Industrial Production declined by 3.3% MoM in June and by 3.8% YoY, while Capacity Utilization declined by 2.6%, this last, worse than the 0.2% advance expected.
The US will release today July Retail Sales seen up by 0.3% from 0.4% in June. The core reading, Retail Sales Control Group, is seen up by 0.3% vs. the previous 0.7%. The country will also release the usual weekly unemployment figures and some minor regional indexes that have fewer chances of affecting the price.
USD/JPY short-term technical outlook
The pair is gaining short-term bearish traction at the time being, trading near its daily low. In the 4 hours chart, the pair is breaking below its 20 SMA, while technical indicators turned sharply lower, the Momentum still holding above its mid-line, but the RSI already at 45, indicating that further declines are likely. Intraday highs and lows in the 105.50 region, providing an immediate support, with a break below the level opening doors for a steeper decline toward fresh lows below the 105.00 figure.
Support levels: 105.50 105.10 104.85
Resistance levels: 106.05 106.40 106.80
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 drops below 1.0800 after German Retail Sales data
EUR/USD has come under fresh selling pressure and trades below 1.0800 after the data from Germany showed that Retail Sales declined by 1.9% MoM in February. Resurgent US Dollar demand is adding to the downside in the pair. US data are next in focus.
GBP/USD stays weak near 1.2600 amid market caution
GBP/USD remains defensive near 1.2600 in European trading on Thursday. The hawkish tone from Fed Governor Christopher Waller keeps the US Dollar afloat amid a cautious trading environment ahead of key US data releases and the Good Friday trading lull.
Gold price holds strength ahead of US core PCE inflation
Gold price holds onto gains near $2,200 in Thursday’s European session. The precious metal exhibits firm footing ahead of the United States core PCE Price Index data for February, which will be published on Friday.
XRP price falls to $0.60 support as Ripple ruling doesn’t help Coinbase lawsuit against SEC
XRP programmatic sales ruling by Judge Torres was completely rejected by another US Court that ruled in favor of the SEC in a lawsuit against Coinbase.
Portfolio rebalancing and reflation trades emerge into Q2
Yesterday’s price action pointed at a possible end-of-quarter portfolio rebalancing as the session saw the laggards of the quarter like Apple and Tesla gain, and the stars like Microsoft and Nvidia retreat.