JPYUSD analysis 28.07.2020

The fluctuation of the US dollar in a narrow range tilted to the upside during the Asian session, to witness the lowest since March 13 against the Japanese yen, following developments and economic data that were reported by the Japanese economy and before the economic developments and data expected today Tuesday by the US economy, the largest economy in the world, which Includes launch of the FOMC meeting July 28-29.

At exactly 05:57 am GMT, the US dollar pair rose against the Japanese yen by 0.19% to 105.57 levels compared to the opening levels at 105.37 after the pair achieved its highest level during the trading session at 105.69, while achieving the lowest at 105.69.

We have followed on from the Japanese economy, the second largest economy in Asia and the third largest economy in the world, to disclose inflation data with the release of the annual reading of the services price index by the Bank of Japan for the month of June, which showed the acceleration of growth to 0.8% in line with expectations against 0.5%, which was revised from 0.8% growth in the previous annual reading last May.

On the other hand, investors are currently awaiting by the US economy the disclosure of housing market data with the release of the annual reading of the house price index, which may show accelerated growth to 4.1% compared to 4.0% last May, before the disclosure by the largest industrial country in The world reported a reading of the Richmond Industrial Index, which may reflect a widening of its value of 5 versus the stability at zero levels of 32.3 last June.

This comes in conjunction with the release of the consumer confidence index, which may show a shrinkage of expansion to 94.0 compared to 98.1 in June, leading to the launch of the FOMC meeting held today Wednesday via satellite in Washington, which is expected to keep manufacturers The Federal Reserve's monetary policy on interest rates is between zero and 0.25% for the third meeting in a row

Technical analysis

The dollar against the yen managed to touch the 105.20 level and settle there, and we notice that the stochastic index has started to lose a positive momentum, waiting for a negative momentum that contributes to pushing the price to break the mentioned level and opening the way for the descending wave extension in the short term, where our next target is located at 103.65.

Consequently, the bearish trend scenario will remain likely for the upcoming period, noting that failure to achieve a breakout may push the price to test 106.00 levels and it may extend to 106.44 before any new attempt to decline.

The expected trading range for today is between 104.60 support and 106.00 resistance.

Expected trend for today: bearish.