- – The US Dollar after a decline towards the 116.04 level against the Japanese yen started correcting higher.
- – The USD/JPY pair is currently moving higher, but facing a major resistance near 116.85-90.
- – This week in Japan, the National Consumer Price Index released by the Statistics Bureau posted an increase of 0.5% in Nov 2016 (YoY).
Japanese National Consumer Price Index
This week in Japan, there were a few important economic releases. The most important one was the National Consumer Price Index by the Statistics Bureau. The market was not expecting any major increase above 0.2% in the retail prices of a representative shopping basket of goods and services in Nov 2016 (YoY).
However, the result was better compared with the forecast, as there was a rise of 0.5%. However, when we have a look at the Tokyo Consumer Price Index, there was no chance in the index. The last reading was +0.5%. So, we can say that the result was mixed, but the Japanese yen gained traction during the past few days.
There can be a correction phase initiated in Japanese yen, but the USD/JPY pair is currently facing sellers near 116.85-90. So, it would be interesting to see how the pair will trade in the short term.
USD/JPY Technical Analysis
The US dollar made a downside move recently against the Japanese yen to break the 117.00 support area. The USD/JPY pair during the downside also broke a bullish trend line at 117.70 on the hourly chart.
The pair traded as low as 116.04 where it found buyers and started correcting higher. There was a move above the 23.6% Fib retracement level of the last drop from the 117.80 high to 116.04 low. However, the pair is facing a major resistance near 116.85-90.
The stated level was a support earlier, and now acting as a resistance. The same level also coincides with the 50% Fib retracement level of the last drop from the 117.80 high to 116.04 low. There are already two rejections near the same area, and the pair may soon attempt a break above it. If the bulls succeed, there can be a move towards 117.20. Else, there can be a downside move back towards 116.45.Tags: Dollar, Japanese CPI, Japanese Yen, US Dollar, USDJPY Technical Analysis, Yen