USD/JPY has been very volatile above the support area from 110.80 to 111.70 which is expected to push the price higher towards 114.50 in the coming days. Despite the recent Federal Funds Rate increase to 1.50% from 1.25% earlier, USD failed to gain momentum over JPY and is still struggling to push higher. Today, Japan's Trade Balance report was published which showed an increase to 0.36T from the previous figure of 0.35T which was expected to decrease to 0.27T. The positive Trade Balance indicates the increase in exports in comparison to imports of the country which will lead to further economic development in the medium term. Moreover, BOJ Policy Rate report is going to be published on Thursday which is expected to be unchanged at -0.10%. On the USD side, today NAHB Housing Market Index report is going to be published which is expected to be unchanged at 70, but any change in the figure is expected to have a minor impact on USD to gain or lose some momentum in the coming days. As for the current scenario, USD is still quite strong as despite today's positive report JPY failed to gain momentum. This describes JPY is quite weak in comparison that may lead to further bullish pressure in the pair in the coming days where USD is expected to dominate further.
Now let us look at the technical chart. The price is currently residing above the support area of 110.70 to 111.70 having dynamic level of 20 EMA holding the price to resist its upward movements. The recent bearish rejection on the daily candle indicates that there is certain bullish pressure in the market which is expected to push the price higher towards 114.50 area. As the price remains above the support area of 110.80 to 111.70, the bullish bias is expected to continue further.
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