Current trend

USD against JPY strengthened in sideways consolidation at the lower border of the rising channel and during five trading days it is traded within the range of 110.60–111.40. The main catalyst for declining of the pair was the outflow of investment in USD due to the high volume of fixing long positions.

The data published last week in the US were controversial: on Thursday, the negative statistics on Durable Goods Orders was released, and on Friday, the strong preliminary data on economy growth was published.

Some important releases able to influence the pair will be published tomorrow in Japan. Investors are waiting for the data on labor market and production, as well as the decision on the interest rate and the Bank of Japan outlook report.

In the end of this week attention should be paid to the US labor market.

Support and resistance

In the short term, the recovery of USD is expected. Taking the lower boundary of the ascending channel is unlikely but the instrument may unsuccessfully test the level of 110.50 once again and go to the growth stage. In the medium term, the pair can be expected at the local highs of 112.85, 113.25. The instrument can transfer into a more sloping ascending channel, but it should continue growing. Indicators on the D1 chart and above confirm the forecast: MACD shows the preservation of the high volume of short positions, and Bollinger Bands are directed upwards.

Resistance levels: 111.40, 111.50, 111.75, 112.00, 112.40, 112.85, 113.25.

Support levels: 111.00, 110.85, 110.50, 110.30, 110.00, 109.70, 109.30.

Trading tips

In this situation, long positions may be opened from the current level with the targets at 112.85, 113.25 and stop loss at 110.20.

US Dollar vs Japanese Yen

BuySellSpread
110.889110.86623

Scenario

TimeframeWeekly
RecommendationsBUY
Entry Point111.04
Take Profit112.85, 113.25
Stop Loss110.20
Support levels109.30, 109.70, 110.00, 110.30, 110.50, 110.85, 111.00, 111.40, 111.50, 111.75, 112.00, 112.40, 112.85, 113.25
USD/JPY: long positions are in priority

The material published on this page is produced by the Claws&Horns Company and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC; furthermore it has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on dealing ahead of the dissemination of investment research.

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