US Dollar traded as high as 104.30 versus the Japanese yen before moving down. Can the USDJPY pair retain the bullish trend or continue trading lower?
USDJPY Weekly Analysis – Can Dollar Retain Bullish Trend?
- US Dollar traded lower recently against the Japanese yen, but remains supported on the downside.
- There is a monster bullish trend line formed on the 4-hours chart of the USDJPY pair, which acted as a support zone.
- The 100 simple moving average on the 4-hours chart is also providing bids.
USDJPY Technical Analysis
The US Dollar surged higher to trade above the 104.00 level recently against the Japanese yen. A new monthly high was formed at 104.31 where sellers appeared and pushed the USDJPY pair down.
On the downside, there a monster bullish trend line formed on the 4-hours chart of the USDJPY pair, which is currently acting as a support area.
Moreover, the 100 simple moving average (H4) is also around the trend line support. So, as long as the pair is above it, there is a chance of a bounce back.
Buy Idea – Buying USDJPY around the trend line support can be opted with a stop of a 4-hours close below the 100 SMA.
There were no major releases lately in the US recently and in Japan as well. Today, the Japanese Machinery New orders figure was reported by the Cabinet Office. The market was expecting an increase of 0.3% in the total value of machinery orders placed at major manufacturers in the month of July 2016, compared with July 2015.
However, the report was positive, as the total value of machinery orders rose by 5.2%. When we consider the monthly change, then there was a rise of 4.9%. It was also much better, as the market was expecting a decline of 3.5%.
Overall, the recent economic releases favor the Japanese yen, and may push it higher. However, at the same time we cannot discard the fact that the USDJPY pair has a major support on the downside. This week, the US will witness the Retails Sales report by the US Census Bureau. It may impact the greenback moving ahead.