Key Highlights
- The US Dollar found support near the 109.80 support against the Japanese Yen.
- There was a break below a major bullish trend line with support at 111.10 on the daily chart of USD/JPY.
- The US Initial Jobless Claims for the week ending August 18, 2018 declined from 212K to 210K.
- Today, the US Durable Goods Orders for July 2018 will be released, which is forecasted to decline by 0.5%.
USDJPY Technical Analysis
The US Dollar remained under a lot of pressure below the 111.80 and 111.50 support levels against the Japanese Yen. The USD/JPY pair even traded below the 110.00 level before buyers appeared near 109.80.
Looking at the daily chart, the pair settled below the 111.50 pivot level and broke a major bullish trend line with support at 111.10. However, the 100-day simple moving average (red) and the 200-day simple moving average (green) near the 110.00 level acted as a strong support.
It jumped back above the 110.50 level and the 23.6% Fib retracement level of the last drop from the 113.17 high to 109.77 low. On the upside, there are many resistances formed near the 111.40 and 111.50 levels.
Moreover, the 50% Fib retracement level of the last drop from the 113.17 high to 109.77 low is also near the 111.50 level to prevent gains. Above this, the pair is likely to recover towards 112.00.
On the other hand, if there is a downside correction, the pair is likely to find support near the 110.20 and 110.00 levels.
Recently in the US, the Initial Jobless Claims figure for the week ending August 18, 2018 was released. The market was looking for a rise from the last reading of 212K to 215K.
However, the actual result was positive as there was a decline from the last reading of 212K to 210K. The report stated:
The 4-week moving average was 213,750, a decrease of 1,750 from the previous week’s unrevised average of 215,500.
Overall, the US Dollar may continue to recover versus the Japanese Yen in the short term, while EUR/USD and GBP/USD are likely to extend gains.
Economic Releases to Watch Today
- US Durable Goods Orders for July 2018 – Forecast -0.5% versus +0.8% previous.
- German Gross Domestic Product for Q2 2018 (YoY) – Forecast 2.3%, versus 2.3% previous.
- German Gross Domestic Product for Q2 2018 (QoQ) – Forecast 0.5%, versus 0.5% previous.
