JPY analysis 22.05.2019

The US dollar fluctuated in a tight range slipping towards the Asian session to see its rebound to its second highest session since May 7 against the Japanese Yen following developments and economic data that followed on the Japanese economy and on the eve of developments and economic data expected on Wednesday by the largest US economy World Economy, which includes disclosure of minutes of the FOMC meeting.

At 05:58 am GMT, the pair dropped 0.05% to 110.45 from the opening levels of 110.50, after reaching its lowest level at 110.39, while the highest at 110.63.

We followed the Japanese economy, the world's third-largest economy, by reading the trade balance index, which showed the surplus shrank to 60 billion yen from 529 billion yen in March, worse than the forecast for a surplus of 230 billion yen. Seasonally, the deficit shrank to 111 billion yen from 153 billion yen in March, contrary to expectations that the deficit shrank to 122 billion yen.

The annualized reading of exports showed that the decline of 2.4%, unchanged from March's previous reading, was worse than the 1.5% decline. The annual import reading showed that growth accelerated to 6.4% Compared to 1.2% in the previous year's reading for March, beating expectations that growth accelerated to 4.6%.

We also followed the third-largest industrialized country on the reading of machinery orders reading, which showed growth accelerated to 3.8% from 1.8% in February, in contrast to expectations of stability at zero levels. 0.7% versus 5.5% in the previous annual reading for February, also outperformed expectations of a 3.5% decline.

On the other hand, investors are currently waiting for the Federal Reserve Bank of England (FOMC) Chairman James Pollard to speak about the outlook for the US economy and monetary policy at the Hong Kong Foreign Correspondents Club and the speech of New York Federal Reserve Chairman John Williams at a conference News about US home ownership in New York.

This comes hours before the minutes of the Federal Committee meeting held at the end of April and early May, during which monetary policy makers at the Federal Reserve agreed to keep rates between 2.25% and 2.50% for the third consecutive meeting To move forward with a reduction in bond buybacks before they are frozen by September and a policy of patience.

Technical Analysis

The USD / JPY pair made a clear break of 110.08 and settled above it, signaling signs of an attempt to retrace the bullish trend, supported by moving above SMA 50, but we see that Stochastic is showing a clear buying bias now, Of gains.

Therefore, we prefer to remain neutral until the price confirms the breach of the resistance 110.86 or break the support 110.08, noting that the breach of this resistance will push the price to return to the main upward trend and head towards the areas of 112.14 mainly, while breaking the support will press the price to resume the downward correction Whose next target is at 109.44.

The trading range for today is expected among the key support at 109.80 and the resistance at 111.20.

The expected general trend for today: neutral.