The USDJPY pair continued gaining positive traction for the second consecutive session on Tuesday and touched a one-week high level of 112.74 in the last hour. Where is the pair headed next? find out from today’s technical outlook.
30 October, GKFX – After Friday’s resilience below 100-day SMA, the pair staged a solid rebound at the start of a new trading week and seemed rather unaffected by a sudden overnight reversal in the US equity markets following the latest trade-related headlines.
Bloomberg news reported that the Trump administration was prepared to impose tariffs on all Chinese imports if there is no progress made before the November summit and triggered a fresh wave of risk-aversion trade on Monday.
Global markets, however, saw a major turnaround on Tuesday after the US President Donald Trump, in an interview with Fox News, predicted a “great deal” with China on Trade. The news further dented the Japanese Yen’s safe-haven status and remained supportive of the pair’s ongoing positive momentum.
It would now be interesting to see if bulls are able to maintain their dominant position or the pair once again meets with some fresh supply at higher levels as market participants look forward to the latest BoJ monetary policy update, scheduled to be announced on Wednesday.
In the meantime, today’s relatively thin US economic docket, highlighting the release of Conference Board’s consumer confidence index and the broader market risk sentiment will be looked upon for some short-term trading opportunities.
USDJPY Technical Outlook
Omkar Godbole, Analyst and Editor at FXStreet writes,
“a bullish reversal would be confirmed only above the Oct. 22 high of 112.89 and could yield a rally to a recent high of 114.55.”
He added further,
“the technical indicators are biased toward the bulls. For instance, both MACD and the stochastic are flashing a bullish divergence. Meanwhile, the relative strength index (RSI) is back above 50.00, in bullish territory.”
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