USDJPY Eyes 108.19 As Sellers Remain in Control

The US Dollar (USD) inched lower against the Japanese Yen (JPY) on Wednesday, decreasing the price of USD/JPY to less than 109.50 following some key economic releases. The technical bias remains bullish because of a lower high in the recent upside move.

Technical Analysis

As of this writing, the pair is being traded around 109.27. A support may be seen near 109.00, the psychological number ahead of 109.48, a short-term horizontal support zone and then 108.19, the low of the last major downside move as demonstrated in the given below daily chart. A break and daily closing below the 108.19 support shall incite more selling pressure in the long run.

On the upside, the pair is expected to face a hurdle near 110.42, an immediate trendline resistance ahead of 111.00, the psychological number and then 111.66, the upper trendline as demonstrated with pink color in the above daily chart. The technical bias shall remain bearish as long as the 111.66 resistance area is intact.

Japan’s Index of Coincident

Japan’s index gauging the current state of the economy hit a nine-year high in April, government data showed on Wednesday, a sign a solid recovery was taking hold thanks to improvements in the global economy. Robust factory output of automobile and electronic parts was the main driver of the improvement, adding to a recent slew of bright signs for the export-reliant economy. The index of coincident economic indicators, which consists of data such as industrial output, employment, and retail sales, rose 3.3 points from the previous month to 117.7 in April, the highest level since February 2008.

Trade Idea

Considering the overall technical and fundamental outlook, selling the pair around current levels can be a good strategy in short to medium term.

 

usmanahmed7290@gmail.com'

Usman Ahmed

Usman Ahmed is an individual forex trader and market analyst. He holds a Masters of Business Administration (MBA) degree. His work includes fundamental and technical reports on various currency pairs, commodity futures and stock markets. His technical analysis features price action strategies.

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