JPY analysis 06.08.2019

The US dollar rose during the Asian session to see its rebound from its lowest level since January 3, when it tested its lowest since March 26, 2018 against the Japanese yen following developments and economic data that we followed on the Japanese economy, the world's third largest economy And on the eve of developments and economic data expected Tuesday by the US economy, the largest economy in the world.

At 06:21 GMT, the USDJPY rose 0.46% to 106.44 compared to the opening levels at 105.95, after reaching the highest level at 107.09, while the lowest in seven months at 105.52 .

We have followed the Japanese economy to reveal the annual reading of the index of average wages, which showed a rise of 0.4% compared to a decline of 0.5% in May, contrary to expectations that the widening decline to 0.8%, in conjunction with the publication of the annual index of household spending, which showed Growth slowed to 2.7% from 4.0% in May, beating expectations that growth would slow to 1.3%.

Leading to the release of leading indicators, which showed a narrowing to 93.3 versus 94.9 in May, worse than expected at 93.6. This came hours after Japanese Prime Minister Shinzo Abe expressed concern at the weekend of slowing global economic growth from Because of the trade tensions and its dependence on the economy of his country, stressing his government's commitment to work necessary to support the economy in the face of local and global challenges.

On the other hand, investors are currently waiting for Federal Open Market Committee (FOMC) Chairman and Federal Reserve Chairman Charles Evans to speak at a media briefing hosted by the Federal Reserve Bank of Chicago, before we also see the US economy reading a statistical reading of job opportunities and job rotation. May reflect a rise to 7.34 million versus 7.32 million in May.

This comes before we see another member of the Federal Committee, the head of St. Louis Federal Reserve James Pollard about the economy and monetary policy at a luncheon signed by the National Economists Club in Washington, a few hours after US President Donald Trump asked the Federal Reserve to act and address the China has weakened its yuan currency, which he described as a "major violation" in the midst of a trade war between countries.

Technical Analysis

The USDJPY touched the first target of 105.65 at the beginning of today's trading and is now rebounding strongly to make an upward correction to the recent low from 109.32 and the pair faces strong resistance at 38.2% Fibonacci at 106.97, noting that SMA 50 Is a negative pressure against the price, so that opportunities remain for resuming the downside trend during the coming sessions.

Therefore, we will hold onto our downside expectations, whose main targets start above 105.65 to open the way towards 104.60, noting that a break of 106.97 will halt the expected decline and lead the price to achieve more gains over the intraday basis.

The trading range for today is expected among the support at 106.00 and the resistance at 107.40

The general trend is expected for today: Overall bearish.