USD/JPY Forecast – US Dollar Poised for More Declines Vs Japanese Yen

USD/JPY Forecast – US Dollar Poised for More Declines Vs Japanese Yen

  • – The US Dollar faced a lot of sellers lately and moved below the 110.90 support against the Japanese Yen.
  • – There is a major bearish trend line with resistance at 110.70 forming on the hourly chart of the USD/JPY pair.
  • – Today in Japan, the Industrial Production for May 2017 was released by the Ministry of Economy, Trade and Industry.
  • – The outcome was below the forecast of +1.7%, as there was an increase of 1.6% compared with the previous month.

 

Japan’s Industrial Production

Today in Japan, the Industrial Production for May 2017 was released by the Ministry of Economy, Trade and Industry. The market was expecting an increase of 1.7% in the production compared with the previous month.

 

The actual result was below the forecast, as there was an increase of 1.6%. In terms of the yearly change, there was an increase of 4.9% in May 2017, which was well below the last rise of 6.5%. There was a decline of 2.1% in inventories in May 2017 compared with the previous month.

 

Overall, the USD/JPY pair may correct a few pips towards the 110.70-80 levels, but likely to remain in a downtrend in the short term.

 

USD/JPY Technical Analysis

The US Dollar was under a lot of pressure lately and moved below the 111.25 support area against the Japanese yen. The USD/JPY pair even broke the 111.00 support and the 100 hourly simple moving average to trade towards 110.30.

 

USD/JPY Technical Analysis US Dollar Japanese Yen

 

The pair after trading as low as 111.30 started a correction and currently trading near the 23.6% Fib retracement level of the last decline from the 111.28 high to 110.30 low. On the upside, there is a major bearish trend line with resistance at 110.70 forming on the hourly chart.

 

The same trend line also coincides with the 38.2% Fib retracement level of the last decline from the 111.28 high to 110.30 low. So, if the pair corrects towards 110.70 or 110.80, it is most likely to face sellers in the near term.

 

On the downside, the recent low of 110.30 is a decent support. Below 110.30, the all-important 110.00 handle could be challenged.

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