Japanese yen takeaway
- Within the next 48 hours, traders will be able to get the latest information on Q1 GDP, industrial production, trade balance and national CPI data from Japan.
- USD/JPY has found support at the uptrend line and the 50-day EMA last week, maintaining its short-term bullish bias.
- The next resistance to watch will be the year-to-date highs near 138.00.
Japanese Yen Fundamental Analysis
It will be an important week for Japanese economic data ahead of the G7 summit in Hiroshima this weekend. Over the next 48 hours, the trader can receive updates on his GDP, industrial production, trade balance and national CPI data for the first quarter.
Aside from traditional economic indicators, it’s also worth noting that Prime Minister Kishida has asked the Bank of Japan to examine the sustainability of recent wage increases, which, like everything in Japan, will ultimately could portend a hawkish shift in monetary and fiscal policy. It may take longer than many traders expect.
Source: StoneX
Japanese Yen Technical Analysis – USD/JPY Daily Chart
Looking at the USD/JPY daily chart, interest rates continue to trend upwards after testing the uptrend line support and the 50-day EMA mid-week. Today’s rise was particularly impressive given this morning’s lackluster US data, with retail sales up just 0.4% month-on-month, half the expected 0.8%.
sauce: trading viewStone X
Moving forward, USD/JPY has little resistance nearby, so bulls could try to push USD/JPY back towards year-to-date highs near 138.00, especially if Japanese economic data are worse than expected. have a nature. At the moment, only a bearish reversal below the confluence of the uptrend line and the 50-day EMA near 134.50 will erase the current bullish bias and open the door for further losses.
— By Matt Weller, Head of Global Research
Follow Matt on Twitter: @MWellerFX
