JPYUSD analysis 21.07.2020

The US dollar fluctuated in a narrow range tilted to the upside during the Asian session against the Japanese yen after the economic developments and data that it announced today, Tuesday, on the Japanese economy and amid the scarcity of economic data at the beginning of this week by the US economy, the largest economy in the world and optimism about the positive results about a vaccine Coronavirus and after the European Union leaders reached an agreement on the virus recovery fund.

At 05:54 am GMT, the US dollar pair rose against the Japanese yen by 0.07% to 107.35 levels compared to the opening levels at 107.27 after the pair achieved its highest level during the trading session at 107.36, while achieving the lowest at 107.13.

On the Japanese economy, the second-largest in Asia and the third-largest in the world, we followed the disclosure of inflation data with the release of the annual reading of the national consumer price index, which showed stability in the growth rate of 0.1%, little changed from the previous annual reading last May, exceeding expectations That indicated stability at zero levels.

In the same context, the annual reading of the consumer price index that excludes fresh food showed stability at zero levels versus a 0.2% contraction in the previous annual reading in May, outperforming expectations that the contraction decreased to 0.1% while the annual reading excluding energy and food Fresh & Energy's growth was stable at 0.4%, contrary to expectations for slowing growth to 0.3%.

Technical analysis

The dollar-yen pair is hovering around the EMA50, awaiting a negative incentive supporting the resumption of negative trading over the intraday basis, to visit the 106.44 level as a first negative target.

In general, the downside expectations will remain valid unless the 107.68 level is breached and stability above it, as this breach will push the price to rush towards 109.22 in the short term.

The expected trading range for today is between 106.50 support and 108.00 resistance.

Expected trend for today: bearish.