USDJPY – US Dollar Poised For Further Gains Vs Japanese Yen
Aayush Jindal
USDJPY – US Dollar Poised For Further Gains Vs Japanese Yen
Key Highlights
The US dollar remained in an uptrend against the Japanese yen, as it moved above 104.00.
There was a descending channel pattern formed on the 4-hours chart of USDJPY, which was broken to clear the 104.00 resistance.
Today, the Consumer Confidence will be released by the Conference Board, which may post a decline from 104.1 to 101 in October 2016.
Recently, the US Manufacturing PMI released by the Markit Economics posted a rise from 51.5 to 53.2 in Oct 2016 (preliminary).
USDJPY Technical Analysis
The US Dollar was mostly in an uptrend against the Japanese yen, as it traded above the 104.00 handle. It looks like the USDJPY is a good buy in the short term. Know why.If we have look at the 4-hours chart of USDJPY, then there was a flag pattern formed (descending channel). It can be considered as a bullish flag, and was broken to open the doors for more gains. The next resistance is around the 1.236 extension of the last decline from the 104.47 high to 103.16 low at 104.79.The pair is also well supported on the downside, which may put a lot of pressure on the Japanese yen buyers in the near term.
US Manufacturing PMI
Recently in the US, the Manufacturing Purchasing Managers Index (PMI), which captures business conditions in the manufacturing sector was be released. The report published by the Markit Economics stated that there was an increase to 53.2 in the PMI from the last reading of 51.5 in Oct 2016 (preliminary).The outcome helped the US Dollar to gain momentum and clear the 104.00 resistance in USDJPY. Overall, there were a lot of positives for the US dollar, which helped the greenback to gain control and move higher versus the Japanese yen. More gains are likely as long as the pair is above 104.00.
US Consumer Confidence
Today in the US, there is a crucial release, as the Consumer Confidence figure will be reported by the Conference Board. The market is waiting for the index to decline to 101 from 104.1 in Oct 2016, and if there is a decline, then the US Dollar may come under a minor bearish pressure in the near term.
If we have look at the 4-hours chart of USDJPY, then there was a flag pattern formed (descending channel). It can be considered as a bullish flag, and was broken to open the doors for more gains. The next resistance is around the 1.236 extension of the last decline from the 104.47 high to 103.16 low at 104.79.The pair is also well supported on the downside, which may put a lot of pressure on the Japanese yen buyers in the near term.