The JPY increased significantly in value against the USD after the majority of investors fled the USD after Donald Trump expressed his concerns that the US dollar might be becoming too strong for the US economy to handle. The US 10-year Treasury Yields plummeted to 2.307% during the early hours of yesterday’s trading session, possibly its lowest intraday levels since November 2016. This has then lended support for the bears of the USD/JPY pair after the currency pair traded at the lower regions of 112.67 points before making a slight recovery.
However, there came a slew of negative US data, such as the New York Empire State Manufacturing Index, which dropped to 6.5% from its previous reading of 9.0%. This reading is indicative of slower business growth in the region for this month. Since the USD/JPY was able to extend over 114.00 points, the currency pair is more than ready to extend sideways. The pair’s 4-hour chart shows that its momentum indicator retains its bearish stance and is still within the negative side of the chart, while RSI indicators for the currency pair are pointing to the downside. The 100 SMA for the USD/JPY pair has also lowered significantly.
Support levels for the USD/JPY are expected to manifest at the 112.65 points, while resistance levels could possibly appear once the pair hits 113.35 points.