USDJPY analysis 03.04.2020

The US dollar fluctuated in a narrow range tilted to the upside during the Asian session, to witness its bounce for the second session from the lowest since March 18, and to promise to resume its weekly gains that were suspended last week for the first time in three weeks against the Japanese yen amid the scarcity of economic data in the last sessions Week by the Japanese economy and on the cusp of developments and economic data expected today, Friday, by the US economy.

At 06:02 am GMT, the US dollar pair rose against the Japanese yen by 0.01% to 107.92 levels compared to the opening levels at 107.91, after the pair achieved its highest level during the trading session at 108.20, while achieving the lowest at 107.80.

We followed yesterday, Japanese Prime Minister Shinzo Abe stated that his government will work with local administrations to contain the outbreak of the Corona Virus, while touching that his government discussed whether there is a need to declare a state of emergency in Japan or not, and this happened hours after Abe announced Wednesday his government’s decision To detain all expatriates from his country from outside Japan for a period of 14 days in quarantine, and the decision includes Japanese coming from abroad.

Also, last Wednesday, Japanese Prime Minister Abe announced a ban on arrivals from 49 foreign countries to his country until further notice, and this came hours after a Japanese government spokesman expressed the priority at the present time to put the spread of the Corona virus under control, and that the current situation does not require The government resorted to establishing a state of emergency in Japan, denying the report that recently raised the possibility of Japan declaring a state of emergency at the beginning of this month.

In another context, we followed Wednesday, Bank of Japan Governor Haruhiko Kuroda expressed his admission that central banks cannot deliver banknotes printing for an extended period without borders, while touching that his country is not facing a crisis in price stability at the moment, and informed him that the Bank of Japan is still The growth of inflation is targeted to around 2%, and in order to do so, it will adjust monetary policy when needed to maintain price stability.

On the other hand, investors are currently waiting for the US economy to disclose labor market data with the release of the employment change index for sectors other than agriculture, which may reflect the loss of 100 thousand jobs compared to 273 thousand added jobs in February, while the average income index reading may show Hourly growth slowed to 0.2% versus 0.3%. This is with the unemployment rate reading showing an increase from the lowest in five decades at 3.5% to 3.8%.

This comes before we witness the issuance of the final reading of the Service Supply Institute index by Markit for the United States, which may reflect the widening of the contraction to 38.7 compared to 39.1 in the initial reading for the past month and against a contraction at 49.4 in February, and before revealing the reading of the Institute of Supply Index Service, which may show a contraction of 43.5 compared to 57.3 in February.

We would like to point out, because the reading issuance at 50 or higher reflects a widening, while its issuance is less than 50 indicating a contraction, and that the service provision in America lies in the fact that the service sector represents more than two-thirds of the gross domestic product, otherwise, Wednesday, US President Donald Trump warned of The coming period is "painful" for his country, after he recently announced the extension of the quarantine in America until the end of this month to limit the spread of the Corona virus.

Technical analysis

Yesterday, the dollar pair fell against the yen at 106.90, to rebound up and settle above 107.68 again, affected by the positivity of the stochastic, but we note that the EMA50 continues to press negatively on the price, so opportunities remain to resume the downside correction, awaiting the visit of the 106.44 level as a station deification.

On the other hand, it should be noted that failure to trade below 107.68 again and a breakout of 108.50 will push the price to achieve more intraday gains and test the level of 109.20 before any new negative attempt.

The expected trading range for today is between 106.70 support and 109.20 resistance.

Expected trend for today: Overall decline.