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USD/JPY oscillates at key 108 handle

FXStreet (Barcelona) - USD/JPY is trading at 108.08, up 0.24% on the day, having posted a daily high at 108.19 and low at 107.69.

USD/JPY has been on a ninety-pip escapade around today around the US data that delivered disappointing durable goods -1.3% vs 0.5 consensus. However, there was a vast improvement in consumer confidence in respect of what had been expected 94.5 vs 87.0 which dampened attempts to the downside. Meanwhile, we had good fundamental developments overnight in Japan that were encouraging with the retail sales that came in stronger than expected for the month of September that gave us 2.3% y/y and 2.7%m/m.

This week is a busy week for Japan on the calendar with Industrial Production, Employment, and Inflation before we have the BoJ meeting on Friday. We have already seen how the weak yen has helped the outlook of the Japanese exports that arrived the highest in several months in the last trade balance figures.

Overall, the market is still bullish on the greenback, and 108 is acting as a key level with the pair oscillating in it’s territory. If there is to be a deeper move to the downside, 106.50 is the 38.2% Fibonacci retracement of the Jul 17-Oct 1 rally and may act as a key support for the pair while there is probably less reward to be had to the upside presently.

USD/JPY noteworthy near term levels

Spot is presently trading at 108.08, and next resistance can be seen at 108.19 (Daily High), 108.26 (Daily Classic R1), 108.27 (Weekly High), 108.37 (Yesterday's High) and 108.69 (Daily Classic R2). Next support to the downside can be found at 107.94 (Hourly 20 EMA), 107.93 (Daily Classic PP), 107.82 (Daily Open), 107.79 (Hourly 100 SMA) and 107.69 (Daily Low).

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