Having witnessed some volatility on Tokyo open, the USD/JPY pair is seen trading waters below 5-DMA at 111.40, as markets await fresh impetus for the next direction.
USD/JPY: Yen resilient to poor Japanese PMI
The spot has entered a consolidative mode, as we head towards the European open, as the US dollar remains broadly lower, despite a better sentiment towards risk assets amid a tepid recovery seen in oil prices.
Meanwhile, the downside remains cushioned, as the Japanese currency remains undermined, following a negative surprise presented by the Japanese manufacturing PMI data. Japan flash manufacturing PMI drops to 7-month lows in June
Looking ahead, the major looks forward to the sentiment on the European open, as the Asian traders somewhat cheer UK May’s offer to the EU citizens as well as the Healthcare plan released by the US Senate late-Thursday.
Focus also remains on the US dataflow, with the manufacturing and services PMIs on the cards, followed by the new home sales data and speech by the FOMC member Powell.
USD/JPY Technical levels
According to FXStreet analyst, Omkar Godbole, “the spot may revisit the weekly high of 111.79 and may extend gains to 112.13 if the Fed policymakers talk about a rate hike in September/December. On the downside, only a daily close below 110.74 (200-DMA) would signal bullish invalidation.”
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