Key Highlights
- The US Dollar broke an important resistance near 111.00 against the Japanese Yen.
- There was a break above a significant contracting triangle at 111.30 on the weekly chart of USD/JPY.
- The US Initial Jobless Claims for the week ending July 14, 2018 declined from 215K (revised) to 207K.
- Japan’s National CPI in June 2018 increased 0.7% (YoY), less than the forecast of +0.8%.
USDJPY Technical Analysis
The US Dollar started a major uptrend from the 106.60 low against the Japanese Yen. The USD/JPY pair broke a few important resistances near 110.00 and 111.00 to move into a solid uptrend.
Looking at the weekly chart, the pair formed a key bottom at 104.63 in March 2018. It started an upward move and settled above the 50% Fib retracement level of the last decline from the 114.73 high to 104.63 low.
There was also a close above the 110.00 level and the 100-week simple moving average (red). More importantly, there was a break above a significant contracting triangle at 111.30 on the weekly chart of USD/JPY.
The mentioned triangle break has opened the doors for more upsides in USD/JPY above 114.00. If buyers remain in action, the pair may perhaps trade towards 1.236 Fib extension level of the last decline from the 114.73 high to 104.63 low at 117.12.
On the downside, the broken resistances at 112.00 and 111.00 are likely to act as support, followed by the 100-week SMA.
Recently in the US, the Initial Jobless Claims figure for the week ending July 14, 2018 was released by the US Department of Labor. The market was looking for a rise from the last reading of 214K to 220K.
The result was positive as there was a decline in claims to 207K. However, the last reading was revised from 214K to 215K.
The report added:
The 4-week moving average was 220,500, a decrease of 2,750 from the previous week’s revised average. The previous week’s average was revised up by 250 from 223,000 to 223,250.
Overall, the US Dollar remains in a major uptrend versus the Japanese Yen, and dips are likely to find supports on the downside.
Economic Releases to Watch Today
- German Producer Price Index for June 2018 (MoM) – Forecast +0.2%, versus +0.5% previous.
- Canadian Retail Sales May 2018 (MoM) – Forecast 0%, versus 1.2% previous.
- Canadian Retail Sales ex Autos May 2018 (MoM) – Forecast +0.5%, versus -0.1% previous.
- Canadian Consumer Price Index June 2018 (MoM) – Forecast +0.3%, versus +0.1% previous.
- Canadian Consumer Price Index June 2018 (YoY) – Forecast +2.5%, versus +2.2% previous.
