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USD/JPY: Yen extends gains on upbeat Q4 GDP, attacks 113

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Mar 8, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    USD/JPY met fresh supply just ahead of 113.50 levels and fell once again in the red after the yen jumped back on the bids on the back of above estimates Japan’s final Q4 GDP estimates.

    USD/JPY capped below 113.50 – support turned resistance

    The dollar-yen pair’s recovery from NY lows near 113.20 lost legs at 113.52, and the prices came under renewed selling pressure in the recent dealings after the Japanese final Q4 GDP figures revealed that the contraction was revised lower than previously reported. At the time of writing, USD/JPY drops to fresh session lows of 113.16, down -0.26% on the day.

    The economy contracted 0.3% in Q4 2015 as compared to the previous estimate of -0.4%. The lower revision was mainly on the back of slight improvement in the private demand, which fell 0.5% over the quarter, instead of 0.6%.

    Moreover, the extension of the risk-off mode into Asia, with the Japanese stocks extending losses, also bolsters the safe-haven bids for the yen. The Nikkei 225 index drops -0.40% to 16,845. Later today, focus will continue to remain on the stocks and oil markets for fresh incentives as the US economic calendar remains absolutely data-empty.

    USD/JPY Technical levels to watch

    In terms of technicals, the immediate resistance is located at 114 (round number). A break above the last, the major could test 114.28/58 (Mar 3 & 2 High). While to the downside, the immediate support is seen at 113 (key support) and below that at 112.71/54 (daily S2/ Feb 26 Low).
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