USD/JPY Forecast – US Dollar in Downtrend below 111.20 Vs Japanese Yen
- – The US Dollar faced a lot of selling pressure recently and it moved below 111.00 against the Japanese Yen.
- – There are two bearish trend lines forming with resistances at 111.10 and 111.15 on the hourly chart of the USD/JPY pair.
- – Recently in Japan, the Domestic Corporate Goods Price Index for Dec 2017 was released by the Bank of Japan.
- – The outcome was below the market forecast of 0.4%, as there was a rise of 0.2% in the Domestic Corporate Goods Price Index (MoM).
Japan’s Domestic Corporate Goods Price Index
Recently in Japan, the Domestic Corporate Goods Price Index for Dec 2017 was released by the Bank of Japan. The market was positioned for the index to increase by around 0.4% in Dec 2017 compared with the previous month.
The result was below the market forecast of 0.4%, as there was a rise of 0.2% in the Domestic Corporate Goods Price Index. Looking at the yearly change, the index increased by 3.1%, which was less than the forecast of 3.2%. It was also less than the last reading of 3.5%.
The USD/JPY pair is currently in the bearish zone, and it will most likely decline further if it fails to move above 111.20.
USD/JPY Technical Analysis
The US Dollar faced renewed selling pressure from the 113.40 swing high against the Japanese yen. The USD/JPY pair started a fresh downside wave and moved below the 112.00 and 111.00 support levels. The decline even accelerated below the 111.00 level and the 100 hourly simple moving average.
The pair traded as low as 110.32 and is currently correcting higher. It moved above the 23.6% Fib retracement level of the last drop from the 111.69 high to 110.32 low.
However, there are many resistances on the upside around 111.00 and 111.20. There are also two bearish trend lines forming with resistances at 111.10 and 111.15 on the hourly chart. At the moment, the 50% Fib retracement level of the last drop from the 111.69 high to 110.32 low at 111.00 is acting as a hurdle for buyers.
Overall, it seems like USD/JPY may continue to face sellers in the near term around 111.00-111.20. On the downside, the pair could test 110.20.
Also published on Medium.
