OctaFX – The Japanese yen strengthened against the US dollar in the Asian session. This was a continuation of the trend that started on Thursday last week when the pair hit a high of 114.53.
This was the highest level in more than one year and was an important resistance level. Today’s gains on the yen came as the country released data that showed improved machinery orders.
The sales of machinery rose by an annualized rate of 12.6%. This was higher than the 1.6% gain that traders were expecting. On a MoM basis, the machinery orders rose by 6.8%, which was higher than the minus 4% decline that traders were expecting.
USDJPY Levels to Watch
Last week, the USDJPY reached the highest level since November last year as shown on the daily chart below. As expected, the pair then started a sharp decline that saw it reach an intraday low of 113.00 today.
This level is also the middle band of the Bollinger Bands. This decline happened as bulls exited their trades with a good profit. There is a likelihood that the price will fall further, potentially to the 111.30 level which is also the 61.8% Fibonacci Retracement level before it continues with the upward trend.
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