The USD/JPY is having a quiet morning. Early in the session, there are no economic indicators from Japan or China to impact. However, the Tertiary Industry Activity Index figures will be closely watched late in the Asian session. Economists expect the Index to rise 0.4% in May, compared to 1.2% in April. While the figures …
The USD/JPY is having a quiet morning. Early in the session, there are no economic indicators from Japan or China to impact. However, the Tertiary Industry Activity Index figures will be closely watched late in the Asian session. Economists expect the Index to rise 0.4% in May, compared to 1.2% in April.
While the figures will be interesting, we do not expect tertiary industry activity to have an impact on the Bank of Japan. Investors must wait until Friday for national inflation data to guess what the BoJ will do next.
The US Session
The US economic calendar is jam-packed today. Retail sales, industrial production, and corporate inventories in the United States will be scrutinized. While industrial production figures will be of interest, retail sales will be the focus.
Economists predict that US retail sales will rise 0.5% in June, up from 0.3% in May. While the figures are unlikely to change public perception of the Fed’s monetary policy, they would lend credence to the hypothesis of a gentle landing.
USD/JPY Price Action
4-Hour Chart
The USD/JPY is facing firm resistance at 139 on the 4-hour chart. The USD/JPY has maintained below the 50-day (140.156) and 200-day (140.845) exponential moving averages (EMAs), exhibiting negative signs.
Significantly, the 50-day EMA separated from the 200-day EMA, indicating a return to sub-138 and the 136.3 – 135.6 support area.
The 14-4H RSI value of 43.54 indicates that selling pressure outweighs buying pressure. Notably, the RSI bearishly linked with the 50-day EMA, indicating a drop to sub-137.5 in order to hit the 136.3 – 135.6 support level.
Key notes:
The USD/JPY is experiencing a quiet morning with no economic indicators from Japan or China to influence early trading. However, Tertiary Industry Activity Index numbers will draw interest later in the Asian session.
US retail sales, industrial production, and business inventories will be in focus during the US session. Economists forecast US retail sales to increase by 0.5% in June.
The USD/JPY is currently sitting below the 50-day EMA, indicating bearish near-term momentum, but remains above the 200-day EMA, signaling bullish momentum over the longer-term. The 14-Daily RSI reading of 36.39 also suggests a bearish outlook, with a potential fall to sub-137.5 to target the 136.3 – 135.6 support band.
Risk disclaimer:
Please note that this article does not offer any instructions or suggestions regarding investment decisions. It is important for you to conduct your own research or seek professional advice from a qualified professional before conducting an investment decision.
