The Dollar-Yen recovered ground during the first half of yesterday’s session, rising to 109.29, although the greenback lost momentum by the end of the American session, and following US President Trump’s speech at the Economic Club of New York, which disappointed investors by not giving fresh clues related to trade developments with China. US Equities attempted to hold on to modest intraday gains, but lost most of them earlier in the Asian session, while US-Treasury yields also edged marginally lower. Today, all eyes will be on Fed’s testimony, if Powell reiterates pausing rate cuts, it will likely dent the market sentiment, pushing price below 108.90.
The key level to watch on the Dollar-Yen is the 50-day moving average. If the bulls lose that level, then the bears will likely extend their gains to retest 108.66 and possibly further. The buyers, on the other hand, need to find momentum and push past 109.25 resistance level to secure a rally towards the recent highs 109.50.
Support: 108.9 / 108.66
Resistance: 109.25/ 109.50