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USDJPY – Japanese Yen Proving Its Safe Haven Status

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Aayush Jindal

USDJPY – Japanese Yen Proving Its Safe Haven Status

Key Highlights

  • US Dollar faced a lot of selling pressure against the Japanese yen post the Brexit decision, as the USDJPY pair declined heavily.
  • There was a sharp downside move in USDJPY, taking the pair below a major support area of 104.00-103.60.
  • In the US today, the Gross Domestic Product Annualized will be released by the US Bureau of Economic Analysis, which is forecast to grow by 1% in Q1 2016.
  • The US Consumer Confidence will be released by the Conference Board, which is forecasted to increase from 92.6 to 93.3 in June 2016.

USDJPY Technical Analysis

The US Dollar took a hit against the Japanese yen recently, and it even spiked below the 100.00 support area before recovering. During the downside move, the USDJPY pair also broke a major support area of 104.00-103.60, which may now act as a resistance.USDJPYThe pair is currently below the 100 and 200 hourly simple moving averages, which means there is a lot of bearish pressure. If the pair attempts to correct higher, then both the stated MA’s might act as a barrier for an upside move in the short term.The pair recently broke a short-term bearish trend line, suggesting that there are chances that the pair may attempt to move towards the highlighted resistance area.

US GDP

Today in the US, the Gross Domestic Product Annualized figure will be released by the US Bureau of Economic Analysis. The forecast is slated for the monetary value of all the goods, services and structures produced within a country in Q1 2016 to grow by 1%.Moreover, the GDP Price Index, which gauges the change in the prices of goods and services is forecasted to rise by 0.6% in Q1 2016.

US Consumer Confidence

The US Consumer Confidence will also be released today by the Conference Board. It captures the level of confidence that individuals have in economic activity and is forecasted to increase from 92.6 to 93.3 in June 2016.Both the numbers are important, and may impact the greenback in the near term. Any major deviation from the forecast could ignite swing moves in the USD.In the Euro Zone, the European Central Bank's President Mario Draghi’s speech is scheduled. It would be interesting to listen what the ECB President has to say above the recent Brexit decision.
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