JPYUSD analysis 04.08.2020

The US dollar fluctuated in a narrow range tilted to the upside during the Asian session, to witness its bounce for the third consecutive session from the lowest since March 12 against the Japanese yen after the developments and economic data that we followed about the Japanese economy and before the economic developments and data expected today Tuesday by the economy The American is the largest economy in the world.

At 05:50 am GMT, the US dollar pair rose against the Japanese yen by 0.14% to 106.10 levels compared to the opening levels at 105.95, which is the lowest level for the husband during the trading session, while the pair achieved its highest level during the trading session at 106.19.

On the Japanese economy, the second largest economy 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 Tokyo Consumer Price Index, which showed accelerated growth to 0.6% compared to 0.3% last June, outperforming expectations at 0.4%, as The significant annual reading of the same index, which excludes food, showed that growth accelerated to 0.4% compared to the previous reading and expectations at 0.2%.

In the same context, the core reading of the Tokyo consumer price index excluding food and energy showed that growth accelerated to 0.6% compared to 0.4% in June, agreeing with expectations at 0.5%, and this came before we witnessed the annual reading of the monetary base index by a bank Japan, which showed an acceleration in growth to 9.8%, compared to 6.0% in June, beating expectations that growth accelerated to 7.1%.

It is noteworthy that the rebound of the dollar-yen at the end of last week from the lowest in four and a half months, after Japanese Finance Minister Taro Aso described last Friday the yen's recent rise as "fast", which reflected the Japanese government's concern that the strong currency could add more pain To the Japanese economy, which depends extensively on exports, which are the backbone of the economy and which is already suffering from a recession.

On the other hand, investors are awaiting by the US economy, the largest industrialized country in the world, the release of the factory orders index, which may show a slowdown in the pace of growth to 5.1% compared to 8.0% in May, and this comes in conjunction with the disclosure of a statistic of consumer confidence by daily business For investors that may reflect the contraction shrinkage to 45.3 compared to 44.0 in July.

Technical analysis

The dollar against the yen conducted a new test for the 106.44 level and maintained its stability below it, as it started to bounce down in a sign of the price trend to resume the downside trend, supported by the stochastic negativity, waiting for the visit to the level of 105.20 as a first goal.

Consequently, the downside scenario will remain likely for the coming period unless the price rushes to breach the 106.44 level and maintain a daily closing above it.

The expected trading range for today is between 105.20 support and 106.50 resistance.

Expected trend for today: bearish.