USD/JPY Forecast April 20-24 – Yen Remains Steady, Manufacturing PMIs Next
USD/JPY fundamental mover
Japanese industrial numbers headed lower in February. Industrial Production declined by 0.3%, after a gain of 1.0% in January. As well, Tertiary Industry Activity contracted by 0.5%, after a gain of 0.8% in the previous release.
In the U.S., consumer spending plunged in March. Retail sales declined by a staggering 8.7%, worse than the estimate of -8.0%. The core reading fell by 4.5%, beating the forecast of 4.9%. The employment market remains in disarray, as employment claims topped the five million mark. On the manufacturing front, the Philly Manufacturing Index plunged to -56.6, compared to -12.7 a month earlier. This was weaker than the estimate of -30.0 points.
USD/JPY Technical Analysis
- We start with resistance at 110.62.
- 109.73 is protecting the 110 level, which has psychological significance.
- 108.70 is next.
- 108.10 has switched to a resistance role after USD/JPY posted losses last week.
- 107.30 is an immediate support level. It could see action early next week.
- 106.61 has held in support since mid-March. 105.55 follows.
- 104.65 is the final support line for now.
USD/JPY Daily Chart
USD/JPY Sentiment
I remain bullish on USD/JPY.
The U.S. dollar has emerged as the primary safe-haven asset in the current crisis, outshining the yen. The greenback has held its own against the yen in March and April, despite dismal economic data in the U.S.
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