JPY Analysis 01.11.2019

The dollar fluctuated in a narrow range, tilted to the downside to witness a rebound for the third consecutive session from the highest since early August, when it tested the highest since late May to promise the first weekly losses in four weeks against the Japanese yen following the developments and economic data that followed The Japanese economy is on the threshold of economic developments and data expected on Friday by the US economy, the largest economy in the world.

At 06:07 AM GMT, the US dollar against the Japanese yen fell 0.05% to 107.98 levels from the opening levels of 108.03, after the pair reached its lowest level since October 11 at 107.89, while the pair achieved the highest During the trading session at 108.06.

The Japanese economy followed the release of the Unemployment Rate which rose to 2.4% compared to the previous reading in August and expectations of 2.2%. This came before we witnessed the release of the final reading of the Industrial Purchasing Managers' Index by Markit for Japan which showed a widening Deflation to 48.4 compared to last month's preliminary reading and expectations of 48.5 and 48.9 in September.

This came hours after the Bank of Japan's monetary policy makers decided to keep interest rates negative at 0.10%, which was expected in the markets, with the release of the monetary policy statement of the Japanese central bank, and before the press conference held by Bank of Japan Governor Haruhiko Kuroda on Thursday. In Tokyo, he noted that the bank would not hesitate to expand its stimulus and asset purchase program if necessary.

On the other hand, investors are currently awaiting the US economy to reveal last month's labor market data, which may reflect a rise in the unemployment rate to 3.6% vs. 3.5% in September, while the change in jobs index for non-agricultural sectors may show a slower pace of job creation. The average income per hour may show a 0.3% growth versus steady at zero levels.

This comes before we see the final reading of the US Manufacturing PMI by Markit, which may reflect the stability of the expansion at 51.5, little changed from the initial reading of last month versus 51.1 in September, and before we see the largest The ISM manufacturing index is expected to show a contraction shrinking to 49.0 vs. 47.8 in September.

In the same context, markets are also looking ahead to the US economy for the ISM Manufacturing Price Index reading to 50.1 versus a contraction of 49.7 in September, coinciding with the release of the Construction Spending which reflects accelerated growth to 0.2. % Compared to 0.1% last August.

This comes before we see FOMC and Fed Governor Richard Clarda delivering a speech titled "The United States, Japan and the Global Economy at the Japan Society's Food Banquet in New York," in conjunction with another Fed Governor Randall Quarles's speech on Friedrich. Hayek and the price system at the event hosted by Yale University in Connecticut.

FOMC Chairman John Williams will co-chair a question and answer session at Rutgers University in New Jersey, following the decision of Federal Reserve policy makers at the FOMC meeting October 29-30. Cut interest rates for the third consecutive meeting by 25 basis points to between 1.50% and 1.75%.

Technical Analysis

USDJPY achieved a strong break of 108.40 yesterday and stabilized below it, stopping the suggested positive scenario in our recent reports and putting the price under negative pressure expected for the coming period, but we note that the decline stopped at the support of the bullish corrective channel, accompanied by the emergence of positive signals through the stochastic , Which may push the price to recover again.

Therefore, this inconsistency between the technical factors makes us prefer to remain neutral until we get a clearer signal for the next trend, noting that the breach of 107.95 will press the price to achieve further decline and visit 107.45 as the next negative target, while a breach of 108.40 and stability above it will restore Activate the bullish scenario with its first target at 109.33.

Expected trading range for today is between 107.30 support and 108.80 resistance.

Expected trend for today: Neutral.