USD/JPY Forecast – US Dollar Facing Key Resistances Vs Japanese Yen

USD/JPY Forecast – US Dollar Facing Key Resistances Vs Japanese Yen

  • – The US Dollar tested the 111.10-15 support zone and recovered against the Japanese Yen.
  • – There is a major bearish trend line formed with resistance near 111.55 on the hourly chart of the USD/JPY pair.
  • – Recently in Japan, the Overall Household Spending for June 2018 was released by the Ministry of Internal Affairs and Communications.
  • – The outcome was above the market forecast of -1.6% as there was a 1.2% decline (YoY) in the spending.

 

Japan’s Overall Household Spending

Recently in Japan, the Overall Household Spending for June 2018 was released by the Ministry of Internal Affairs and Communications. The market was positioned for a decline of around 1.6% in the spending compared with the same month a year ago.

 

The actual result was above the market forecast of -1.6% as there was a 1.2% decline (YoY) in the spending. This was also better than the last decline of 3.9%. Moreover, the labor cash earnings in June 2018 increased 3.6% (YoY), more than the market forecast of 1.7%.

 

The USD/JPY pair is currently recovering, but it is facing a tough hurdle near the 111.40 and 111.55 levels.

 

USD/JPY Technical Analysis

The US Dollar declined recently and broke the 111.80 support level against the Japanese Yen. The USD/JPY pair even broke the 111.50 support and traded as towards the 111.10-15 support zone where buyers appeared.

 

USD/JPY Technical Analysis US Dollar Japanese Yen

 

The pair started an upside move and traded above the 23.6% Fib retracement level of the last decline from the 111.87 high to 110.11 low. However, the upside move was capped by the 111.50 level and the 50% Fib retracement level of the same decline.

 

It seems like there is a contracting triangle forming with resistance near 111.35 on the hourly chart. Above this, the 100 hourly simple moving average is positioned near the 111.55 level. Moreover, there is a major bearish trend line formed with resistance near 111.55 on the hourly chart of the USD/JPY pair.

 

Therefore, if the pair moves further higher, it is likely to face a strong resistance near 111.50-55. Above this, the pair may well rise towards the 112.00 level. On the flip side, if there is a downside move, the pair could revisit the 111.10 support area.


Also published on Medium.

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