USD/JPY Current price: 106.82

  • Japanese Machine Tool Orders plummeted 31.1% YoY in July, according to preliminary estimates.
  • US Initial Jobless Claims foreseen at 1.12M from 1.18M in the previous week.
  • USD/JPY is trading near 107.00 with the risk skewed to the upside.

The USD/JPY pair is trading near its recent highs in the 107.00 price zone, holding on to gains but unable to run amid decreased interest on the greenback. Safe-haven assets, however, have been unable to appreciate, but instead consolidate around their Wednesday’s closing levels.  Supporting the pair, government bond yields hold near their recent one-month highs. Equities, on the other hand, trade mostly in the red, although not far from their opening levels.

Japan published at the beginning of the day the July Producer Price Index, which was up 0.6% in the month, and down 0.9% when compared to a year earlier, both figures beating expectations. Machine Tool Orders, in the same month, plummeted 31.1% YoY. The US will publish today its usually weekly unemployment data. Initial Jobless Claims are foreseen at 1.12M down from 1.18M in the previous week.

USD/JPY short-term technical outlook

The USD/JPY pair continues to comfortably consolidate around 106.80. The short-term picture indicates that the risk is skewed to the upside, as the price remains above its 200 SMA, which provides intraday support around 106.56, the daily low. The 20 SMA maintains its bullish slope, further advancing above the 100 SMA. Technical indicators, in the meantime, hold well above their midlines, although lacking directional strength. A break below the daily low should open doors for a steeper decline towards the 105.70 price zone.

Support levels: 106.55 106.25 105.70  

Resistance levels: 107.00 107.45 107.80

View Live Chart for the USD/JPY


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