Sunday, September 2, 2018

USD/JPY - 03 September 2018


Fundamental Highlights

Bullish close for the pair on Friday as USD strengthened backed by better than expected data of the Chicago Purchasing Managers’ Index and the Michigan Consumer Sentiment Index. Modest gains for the JPY in today's early trading (Japanese Capital Spending data (YoY) (Q2) rose at the fastest pace in over a decade in April-June Quarter). The pair was held by Bank of Japan's Governor Kuroda's speech and concerns about high frequency trading impairing financial market stability. No economic news expected out of the US today in celebration of Labor Day.

Technical Analysis

So far price has rejected Friday's daily bullish hammer reversal bar suggesting a favorable short trade setup with a stop set at today's high of 111.18 which also happens to be our previously set resistance level. MACD crossing from positive to negative on the hourly chart confirms this view, awaiting further confirmation with price using our 110.90 support level as resistance and on the break of the uptrend. Long setup if pair turns from red to green during today's trading session (above 111.09). N.b: In the last 4 years USDJPY recorded an average of 1$ move in price on the American Labor Day.

Support: 110.90 110.45
Resistance: 111.17 111.42

Chart (H1)