- USD/JPY marks in a fresh four-month high as markets rally on positive trade hopes.
- First half of the week is devoid of meaningful data, but FOMC drops on Wednesday.
The USD/JPY is continuing to climb in Tokyo trading and the pair has hit into new four-month highs, trading into 111.10.
The US Dollar is getting propped up as global markets kick off the new week on a positive note following weekend comments from the US Treasury Secretary Steven Mnuchin, who stated recently that the US would be holding off of imposing any new tariffs on China while the current trade negotiations continue, marking a critical easing in the ongoing trade rhetoric that has been slowly ramping up towards a full-blown trade war for months. Markets awoke to a newfound bullish stance and safe haven assets like the Yen are taking a step down across the board.
Japanese data early Monday managed to strike a positive note, with the Japanese Merchandise Trade Balance clocking in at ¥626 billion; still a contraction from the previous figure of ¥797.3 billion, but marginally better than the forecast figure of ¥405.6 billion. The first half of this week will be a quiet affair, with little on the economic calendar for either currency, but that all changes on Wednesday, when the US sees the FOMC’s Meeting Minutes as traders are eagerly expecting the addition of another rate hike this year.
USD/JPY levels to watch
Valeria Bednarik, chief analyst at FXStreet explained that in the 4 hours chart, technical indicators retreated from overbought readings but stabilized well above their mid-lines: “the pair keeps developing above bullish 100 and 200 SMA, indicating that any decline will likely remain corrective as long as the pair remains above the 109.60 level.” Meanwhile, a close above the level over consecutive days is needed to put eyes back on the 112.30’s, (Fibos at 112.22/33) 111.50 needs to be broken first as being another potential option barrier.
Share
