USD/JPY has been quite bearish after breaking below the 110.20-60 support area recently which is expected to continue but with certain retracement along the way. JPY has been quite stronger in comparison to USD despite the positive USD economic reports published recently. Today USD showed a good amount of strength over JPY because of the rising US Treasury Yields and Higher Equity Markets which is expected to be good for the retracement towards 110 level again. Today JPY Prelim GDP showed a positive rise to 1.0% from the previous value of 0.3% and Prelim GDP Price Index showed less deficit at -0.4% from the previous value of -0.8%. These positive economic reports did not quite help the JPY to gain today in absence of USD economic reports today which does signal that USD is expected to be quite stronger this week against JPY. On the USD side, tomorrow Core Retail Sales report is going to be published which is expected to be quite positive at 0.3% from the previous negative value of -0.2% and Retail Sales report is expected to have a positive rise as well to 0.4% from the previous negative value of -0.2%. If USD manages to publish positive economic reports tomorrow we might see a further gain on USD against JPY in the coming days.
Now let us look at the technical view, the price is currently showing some bullish gaining after the indecisive daily close on Friday. The price is expected to reach 110.20-60 resistance area before proceeding lower with a target towards 108.40-50 area. As the price reaches 110.20-60 resistance area the dynamic level is also expected to work as resistance along the way to resist the price to move higher and bearish bias is expected to continue further as well.
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