Forex Marketz Daily Forex News – Fully Markets Update
Looking at the benchmark USD/JPY currency exchange rate, the U.S. dollar remains in the driver’s seat over the Japanese yen. The improving situation in the United States with the coronavirus pandemic and added fiscal stimulus is supporting the fundamentals over the technical positioning.
The dollar is also getting a rate yield boost over the Japanese yen as Treasury yields have recovered. The Federal Reserve Board is not very likely to change monetary policy anytime soon and neither is the Bank of Japan.
This could further support the USD/JPY Forex market in the near to medium return. Last week’s better than expected monthly non-farm payroll (NFP), released by the Labor Department, should also support the greenback as a new week begins.
The economic calendar, for Monday, does not have many high impact events. Japan is publishing monthly house hold spending data. The American economic calendar will feature the Institute for Supply Management’s (ISM) monthly services purchasing managers’ index (PMI) for the United States. A better than expected report could weaken the U.S. dollar. The U.S. is also releasing monthly factory orders.
Daily U.S. Dollar Technical Analysis (USD/JPY)
Looking at price action on the above USD/JPY daily MT 4 chart, the 14 day relative strength index (RSI) is near overbought at over 80. This could lead to short term profit taking. The 21 day simple moving average (SMA) lines up at 109.20 as initial downside support.
The next layer of technical support lines up at the one hundred day simple moving average at 105.0 with the 200 day simple moving average in play at 105.60 yen.
On the upside, initial technical resistance lines up at 111 yen. The next upside barrier lines up at 111.70 yen. The next upside barrier to watch comes into play at the pre-pandemic high price point. That key layer of technical resistance lines up at 112.23 yen.
