The Dollar/Yen gained some ground yesterday following the equities’ footsteps, despite the signs of a global economic slowdown being all around us. Japan’s economy remains fragile, with exports down due to the global trade war. BoJ policymakers remain nervous, as some members suggesting more stimulus in order to boost the economy. Due to lack of any major economic data today, investors will remain focused on global stock markets for any directional clues.
The USD/JPY broke above 110.40 (S1), previous resistance turned new support level. Price action is getting ready for one more leg up towards 110.85 (R1) where we can also find the 50/200-day moving averages (blue and yellow lines). We expect that level to be a strong resistance area, where the market could start selling off once again.
Support: 110.4 / 109.8
Resistance: 110.85 / 111.1