USDJPY analysis 23.01.2020

The US dollar fell during the Asian session to witness its rebound to the fourth session in five sessions from the top since May 23 against the Japanese yen after the developments and economic data that it had reported on the Japanese economy and on the cusp of developments and economic data expected today Thursday by the American economy and in the shadows of activities World Economic Forum 2020 and concern about the spread of Corona virus and its transformation into a global epidemic.

At 6:11 am GMT, the US dollar pair fell against the Japanese yen by 0.25% to 109.56 levels compared to the opening levels at 109.84, after achieving the lowest level since January 13 at 109.55, while achieving the highest during The session trades at 109.87.

On the Japanese economy, we have followed the release of the Trade Balance Index reading, which showed that the deficit widened to 152.5 billion yen compared to 85.2 billion yen in November, contrary to expectations that the deficit widened to 152.6 billion yen, while the seasonally adjusted reading of the same indicator The deficit widened to 102.5 billion yen from 91.9 billion yen in November, also contrary to expectations that the deficit widened to 236 billion yen.

This came before we witnessed the third largest economy in the world and the third largest industrialized country globally after each of the United States and China, the disclosure of industrial sector data with the release of the index of overall industrial activities, which showed an increase of 0.9% compared to a decline of 4.8% which was modified from a decline of 4.3% In the previous reading last October, it surpassed expectations that indicated a rise of 0.4%.

On the other hand, investors are currently looking for the US economy to publish a reading of the aid requests index for the previous week on January 18, which may reflect an increase of 10 thousand requests to 214 thousand applications compared to 204 thousand requests in the previous weekly reading, while a reading of the index may Subsidy applications Investors for the previous week on the 11th of this month decreased by 17 thousand requests to 1,750 thousand requests compared to 1,750 thousand requests.

This comes before we witnessed by the largest economy in the world and the largest industrialized world in the world, the disclosure of the reading of the leading indicators, which may show a 0.2% decline against stability at zero levels last November, in conjunction with the entry of the World Economic Forum in Davos, which is entering Switzerland. On its third day in a row, during which the attendees discuss the latest developments on the world stage, on the political and economic levels.

It is reported that US President Donald Trump noted yesterday from Davos that the Federal Reserve is harming economic growth and stock market gains, expressing that without the interest rate hike on federal funds, the Dow Jones index would rise by an additional ten thousand points, explaining that the strength of the green currency is hurting the United States’s exports and industrial activities, And adding that the US dollar should be weakened.

Other than that, we have followed the Chinese authorities' suspension of overseas flights and railway services from the city of Wuhan where the Coronavirus was born as part of efforts to contain the pneumonia virus that has killed at least 17 people and infected more than 540 people, amid fears of an outbreak that could turn A global epidemic after health officials in many countries confirmed cases of the Chinese virus.

Technical analysis

The dollar versus yen pair is showing negative trades now to approach the pivotal support test 109.33, and as long as the price is above this level, our expectations for the upward trend will remain valid for the next period, supported by the entry of the stochastic indicator to the oversold areas in the sale again, awaiting the direction towards 110.50 as a first goal.

It should be noted that breaking 109.33 and holding below it will put the price under negative pressure aimed at visiting the 108.40 level before any new attempt to rise.

The expected trading range for today is between 109.00 support and 110.40 resistance.

Expected trend for today: bullish.