JPY Analysis 16.09.2019

The US dollar rose during the Asian session to witness the rebound of the eleventh session in sixteen sessions from the lowest since November 9 of 2016 against the Japanese yen amid the lack of economic data earlier this week by the Japanese economy, the world's third largest economy on the cusp of Economic developments and data expected on Monday by the US economy, the largest economy in the world.

At 06:23 am GMT, the US dollar against the Japanese yen rose 0.20% to 107.85 levels compared to the opening levels at 107.64, after the pair reached its highest level during the session at 107.92, while the lowest level at 107.46, knowing The pair started this week on a bearish price gap after closing last week at 108.09 levels.

Investors are currently awaiting the US economy, the world's largest industrialized countries, on the release of the New York manufacturing index, which may show the contraction widened to 4.1 from 4.8 in August. This comes just hours before Tuesday's release of the industrial production index which may show a rise of 0.2% against It slipped 0.2% in July, while the Energy Expenditure Rate reading may reflect accelerating growth to 77.6% vs. 77.5%.

Markets are also looking ahead to the FOMC meeting on Tuesday and Wednesday in Washington, which is expected to cut the federal funds rate by 25 basis points for the second consecutive meeting to between 1.75% and 2.00%. On the expectations of members of the Committee on growth rates, inflation and unemployment in addition to the future of interest rates for the next three years.

Federal Reserve Governor Jerome Powell is due to hold a press conference next Wednesday, half an hour after the FOMC meeting, which has been widely criticized by US President Donald Trump for demanding the Fed. And Powell's governorate cut interest rates "to zero or less."

Otherwise, the Japanese yen drew support earlier this week from the recent geopolitical strikes from last weekend's drone attacks on oil production facilities in Saudi Arabia, the world's largest oil exporter, OPEC and third. The world's largest oil producer and OPEC's largest, carried out by the Houthi rebels in Yemen.

President Trump said Sunday that the United States was "locked and loaded based on the investigation" that Iran had launched a major Saudi oil attack, and several administration officials also expressed yesterday that they had strong evidence that Iran was behind the attack. It is not the Houthis who claimed responsibility last Saturday, which prompted investors to divert liquidity to safe havens, including the Japanese yen.

Technical Analysis

The USDJPY opened lower today to test support for the rising channel shown in the picture, and is starting to rise now, where it gets positive support from SMA 50, while Stochastic is heading towards oversold areas.

Therefore, the bullish scenario will remain likely for the coming period, with a break of 108.30 pushing the price to 109.30 as the next stop, while the price needs to hold above 106.70 to sustain the expected rally.

Expected trading range for today is between 107.20 support and 108.70 resistance.

Expected trend for today: Bullish.