USDJPY analysis 20.04.2020

The US dollar fluctuated in a narrow range tilted to the upside during the Asian session, to witness its bounce for the third session in four sessions from the lowest since the beginning of April when it tested the lowest since 18 March against the Japanese yen after the economic data we released today on the economy The Japanese economy amid the scarcity of economic data earlier this week by the US economy, the largest economy in the world.

At exactly 06:04 am GMT, the US dollar pair rose against the Japanese yen by 0.33% to 107.89 levels compared to the opening levels at 107.55 after the pair achieved its highest level during the trading session at 107.91, while it achieved the lowest at 107.49, knowing that The pair started trading this week on an upward price gap after it concluded the trading last week at 107.54 levels.

We have followed on from the Japanese economy the release of the Trade Balance Index reading, which showed the surplus narrowed to 4.9 billion yen from 1,109 billion yen last February, contrary to expectations that indicated a surplus of 460 billion yen, while the seasonally adjusted reading of the same indicator showed a deficit of 190 billion yen Against a surplus of 482 billion yen, contrary to expectations that indicated a deficit of 115 billion yen, and this came with the expansion of exports and the decline in imports during the past month.

Otherwise, last Thursday, we followed the announcement of Japanese Prime Minister Shinzo Abe to expand the state of emergency to include all of Japan, with his statement that the state of emergency will continue until the sixth of next May, and his call for citizens not to move from one city to another to contain the spread of the Coronavirus, It is reported that Abe announced on the seventh of this month the imposition of a state of emergency on seven Japanese cities, headed by the then Japanese capital, Tokyo.

On the other hand, we followed last weekend, Speaker of the US House of Representatives Nancy Pelos and US Treasury Secretary Stephen Mnuchin expressed optimism about a deal to increase funds in the loan program that aims to help small American companies withstand the consequences of the coronary virus outbreak in The United States recently.

In another context, New York State Governor Andrew Como also stated at the end of last week that his state may have exceeded the high level of death from coronavirus, and states that fewer daily deaths were reported in Italy, Spain and the United Kingdom, according to the latest figures issued by the World Health Organization, the number of cases infected with the Coronavirus rose to nearly 2.25 million, and 152,707 people were killed in 213 countries.

Markets are looking closely now at developments in Gilead Sassensis’s disclosure of its drug that is rumored to be effective in combating coronavirus and can eradicate it, especially that it can be effective in dealing with critical cases. It is reported that US President Donald Trump recently announced his administration’s plan to restart and operate the economy The US gradually, indicating the possibility of a global medical crisis to subside later, while its economic consequences remain.

Technical analysis

Despite the positive opening today, the USDJPY closed last Friday's trading below 107.68, to rely on this negative close and continue to favor the bearish trend for the upcoming period, supported by the EMA50, waiting for the visit of the 106.44 level as a next target.

The stochastic oscillator starts losing positive momentum to support the downside expectations, which will remain valid unless the price holds above 107.68.

The expected trading range for today is between 106.70 support and 108.40 resistance.

Expected trend for today: bearish.