USD/JPY rose to intra-day high of 110.20 despite upbeat GDP data
- Headline GDP beat market consensus but previous figures are revised down.
- Risk sentiment to direct near-term trade momentum amid no major data/event.
USD/JPY rose to the intra-day high of 110.20 despite Japan’s Q1 2019 GDP data beat forecasts on early Monday. The reason for the rise could be a downward revision to previous figures.
Japan’s first quarter (Q1) gross domestic product (GDP) beat 0.0% forecast and 0.4% prior (revised from +0.5%) on a QoQ basis to flash +0.5% mark while crossing -0.2% expectations for annualized figure with 2.1% against revised down prior of +0.6% (earlier +1.9%).
Risk tone remained largely unchanged on early Monday as results of Australia’s general election confronted with the US-Iran tensions. Also adding to the mixed sentiment was the US-China updates and Canada’s optimism after the US cancellation of steel and aluminum tariffs.
The global barometer for risk sentiment, the US 10-year treasury yield, is at 2.40%.
Australia’s present PM Scott Morrison registered a surprise victory despite opposition’s efforts to topple the government whereas the US President Donald Trump turned harsh on Iran after reports of a “rudimentary rocket” fired near the US embassy in Iraq.
Moving on, Chinese lawmakers have started announcing their resentment from the US behavior and have also advised to not travel Beijing for further trade talks amid presently pessimistic environment.
While there prevails little data on the economic calendar, news details concerning the US, Iran, and China are to keep entertaining the USD/JPY pair traders.
Technical Analysis
Sustained trading beyond 110.00 enables the USD/JPY pair to aim for 100-day simple moving average (SMA) level of 110.50. However, four-week-old descending trend-line at 110.65 and 111.10 comprising 50-day SMA could question buyers then after.
Meanwhile, March month low near 109.70, followed by current month bottom around 109.30, may entertain short-term sellers ahead of pleasing them with 109.00 and 108.80 rest-points.
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
