USDJPY analysis 29.04.2020

The US dollar fell during the Asian session to witness its lowest since March 17 against the Japanese yen, amid the scarcity of economic data by the Japanese economy due to a holiday in Showa in Japan and on the cusp of developments and economic data expected on Wednesday by the American economy, which includes the activities of the Federal Committee meeting For the open market and press conference of Federal Reserve Governor Jerome Powell and in the shadow of market pricing to ease restrictions and the close of the global close, with many countries announced plans to ease the restrictions.

At 05:50 am GMT, the US dollar pair declined against the Japanese yen by 0.31% to 106.54 levels compared to the opening levels at 106.87 after the pair achieved a six-week low at 106.51, while it achieved its highest during the trading session at 106.90.

Investors are currently awaiting by the US economy the disclosure of the initial reading of the gross domestic product of the United States for the first quarter, which may show a contraction of the largest economy in the world 4.0% compared to growth of 2.1% in the fourth quarter, while the initial reading may reflect the GDP measured in prices from Last quarter, the pace of growth slowed to 1.0% compared to 1.3% in the fourth quarter.

This comes before we witness the disclosure of housing market data with the release of existing home sales, which may show a 13.3% decline compared to a rise of 2.4% last February, and in conjunction with the activities of the Federal Open Market Committee meeting April 28-29, which is expected to Through it, monetary policymakers at the Federal Reserve maintain reference interest rates at zero levels between 0.25 and 0.25%.

Up to the events of the press conference that will be held by Federal Reserve Governor Jerome Powell, which comes half an hour after the end of the activities of the meeting of the Federal Open Market Committee in Washington, and it is reported that the Federal Committee approved at the surprising previous meeting held on March 15, which was the second in Less than two weeks after the previous snap meeting on the third of the same month, returning interest to zero levels.

It is noteworthy that the Federal Committee reduced the interest on federal funds in the previous meeting by 100 basis points from between 1.00% and 1.25% to zero levels, which it remained from 2008 until the meeting of 27-28 October 2015, after reducing it at the emergency meeting The previous rate of 50 basis points from between 1.50% and 1.75%, and in the wake of cutting interest three times by 25 basis points in previous meetings last year.

Technical analysis

The dollar against the yen pair traded negatively yesterday, to reach a few points difference from our awaited target at 106.44, and it is under constant negative pressure coming from the EMA50, which supports the chances of breaking this level to open the way for the descending wave to reach 105.20 as the next negative target.

Consequently, the downside direction will remain favorable during the upcoming sessions, provided that the price maintains its stability below 107.68 and 108.10 levels.

The expected trading range for today is between 105.90 support and 107.60 resistance.

Expected trend for today: bearish.