On Friday, the USD/JPY currency pair pulled back from the session highs of about 160.32 to trade at about 160.03. The currency pair trades within an ascending channel formation in the 60-minute chart.
Friday’s pullback pushed the currency pair a few levels below the 100-hour moving average line. As a result, the pair is on the verge of re-entering the oversold levels of the 14-hour RSI.
USD/JPY Fundamentals Overview
From a fundamental perspective, the USD/JPY currency pair trades during a relatively busy period in both markets. In Japan, the gross domestic product for Q1 outperformed the (QoQ) forecast of 0.3%, with a change of 0.5%. The annualized gross domestic product for the quarter also outshone the estimated change of 1.3%, with a change of 1.8%, while the gross domestic product deflator for the period fell short of the forecasted (YoY) change of 3.4%, with a change of 3.2%.
In the US, the producer price index for May outperformed the (MoM) forecast of 0.7%, with a change of 1.1%. The (YoY) equivalent also came in better than expected, with 6.5% versus a forecast of 6.4%. On the other hand, the producer price index ex-food and energy missed the expected (MoM) and (YoY) changes of 0.5% and 5.4%, respectively, with changes of 0.4% and 4.9%. The initial jobless claims for last week also fell short of the forecasted claim count of 219k, with a tally of 229k, up from the previous week’s equivalent of 225k.
Earlier in the week, the US consumer price index for May matched the (MoM) and (YoY) forecasts of 0.5% and 4.2%, respectively. On the other hand, the consumer price index ex-food and energy fell short of 0.3%, with a change of 0.2% (MoM), while the (YoY) equivalent matched the estimate of 2.9%.
USD/JPY Technical Analysis (the 60-min Chart)
Technically, the USD/JPY currency pair trades within an ascending channel formation in the 60-minute chart. However, the 14-hour RSI has recently pulled back to move closer to oversold conditions.
Therefore, the bears will look to extend the latest pullback towards 159.74 or lower to 159.45. On the other hand, the bulls will look to pounce on profits at about 160.32 or higher at 160.61.
USD/JPY Technical Analysis (the Daily Chart)
In the daily chart, the USD/JPY currency pair trades within an ascending channel formation. However, the 14-day RSI has recently pulled back to avoid entering overbought conditions.
Therefore, the bears will look to extend the current pullback towards 158.65 or lower to 157.22. On the other hand, the bulls will look to pounce on profits at about 161.52 or higher at 162.95.
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