USD/JPY retreats toward 110.00, flat for the week


USD/JPY dropped during Friday’s American session and erased most of the gains. The Japanese yen gained momentum near the end of the week amid a recovery in US bonds and after equity prices in Wall Street trimmed most of the gains. 

Earlier the pair peaked at 110.80, the highest in a week and now is hovering around 110.20, after bottoming at 110.11. The greenback still remains in positive territory for the day and practically unchanged for the week. 

On Tuesday it dropped to the lowest in almost two months at 109.10. Then, as US yields rebounded, it started to recover. The 10-year yield fell to 2.13% on Wednesday and on Friday rose on top of 2.20%. 

Next week the US dollar and the yen are likely to be affected by the Federal Reserve meeting. A rate hike is expected. Also, the statement and Janet Yellen’s press conference have a strong potential to impact on prices. 

Technical outlook 

The pair is about to end the week still moving with a positive tone in the very short-term, but the momentum eased considerably. USD/JPY failed to consolidate above 110.50, a technical level and pulled back. 

The downside trendline from May’s highs remains intact. Today the line, that stands around 110.70/80, was tested but greenback found resistance and lost strength. A break above could give support to the US Dollar for a stronger recovery. 

If the pair resumes the decline and drops below 109.40, it would add bearish pressure, exposing 109.00 and below, 2017 lows located near 108.00.
 

<a href="http://www.instaforex.com/?x=XWD" target="_blank" rel="nofollow" >InstaForex</a>

Loading Facebook Comments ...

Leave a Reply