USD/JPY Forecast – US Dollar to Weaken Vs Japanese Yen?

USD/JPY Forecast – US Dollar to Weaken Vs Japanese Yen?

  • – The US Dollar formed a short-term top near 107.10 against the Japanese Yen, and declined.
  • – There was a break below a key bullish trend line with support at 106.70 on the hourly chart of the USD/JPY pair.
  • – Recently in Japan, the Business Survey Index (BSI) Large Manufacturing for Q1 2018 was released by the Ministry of Finance.
  • – The outcome was below the market forecast of 5.0 as there was a decline in the index from 9.7 to 2.9.

 

Japan’s Business Survey Index (BSI) Large Manufacturing

Recently in Japan, the Business Survey Index (BSI) Large Manufacturing for Q1 2018 was released by the Ministry of Finance. The market was positioned for the index to decline from 9.7 to 5.0.

 

The result was below the market forecast of 5.0 as there was a decline in the index from 9.7 to 2.9. Looking at the Business Survey Index (BSI) Large Non-Manufacturing index, there was a decline from the last reading of 4.5 to 3.4.

 

The USD/JPY seems to be trading below a major support at 106.90 and it may decline further in the near term.

 

USD/JPY Technical Analysis

The US Dollar was in a nice uptrend as it moved above the 106.50 resistance area against the Japanese Yen. However, the USD/JPY pair failed to gain momentum above the 107.00 level and it formed a short-term top near 107.05.

 

USD/JPY Technical Analysis US Dollar Japanese Yen

 

The pair started a downside move and broke the 23.6% Fib retracement level of the last wave from the 105.45 low to 107.05 high. Moreover, there was a break below a key bullish trend line with support at 106.70 on the hourly chart of the USD/JPY pair.

 

The pair seems to be moving in a bearish zone and it could decline further towards 106.25. The mentioned level is a decent support since it is the 50% Fib retracement level of the last wave from the 105.45 low to 107.05 high.

 

On the upside, the 106.90 level is an initial resistance. However, the next major resistance is around the 107.00 and 107.05 levels. A break and close above the 107.10 level is needed for buyers to gain traction.


Also published on Medium.

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