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USD/JPY: bid going bad in Tokyo

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Feb 2, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    FXStreet (Guatemala) - USD/JPY has started out in Tokyo's open hour on the bid.

    The support is derived from the 50 sma on the hourly chart, while short-term traders might wish to trade and note that the 10 minute cluster of ma's at 121 prove a tough area of resistance as price is rejected from the 55 and 20 sma, capping the demand. The greenback had a poor session overnight, but staged a recovery vs the Yen.

    The data in the US is troublesome for this week's Nonfarm Payrolls given the downside shown in the ISM manufacturing jobs input, explained here by analysts at ING Bank. For the session ahead, it is all about the RBA, of which a preview can be read here. Although there is no way that the RBA are about to adopt the same policy this meeting around as the BoJ did last week, there is still caution around the statement leading into the meeting and the Yen could be supported.

    USD/JPY levels

    Valeria Bednarik, chief analyst at FXStreet explained, "Shorter term the 1 hour chart shows that the technical indicators are horizontal within neutral territory, but the price remains well above its moving averages.

    "In the 4 hours chart, the technical indicators have corrected partially extreme overbought readings, but are aiming back higher, whilst the price is above the 61.8% retracement of its latest bearish run at 120.60. As long as this last level holds, the downside will remain limited, albeit an advance above 121.70, last week high is required to confirm further gains for this Tuesday."
    For more information, read our latest forex news.

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