Key Points
- The US Dollar traded lower vs the Japanese yen recently, and broke a major support area.
- There was a bullish trend line formed on the hourly chart of the USDJPY pair, which was broken recently by sellers.
- Earlier today, the Japanese Eco Watchers Survey released by the Cabinet Office posted a decline from the last reading of 43.5 to 43.0 in May 2016.
- Moreover, the Japanese Gross Domestic Product released by the Cabinet Office posted an annual growth of 1.9% in Q1 2016, compared with Q1 2015.
Technical Analysis
The US Dollar suffered losses vs the Japanese yen recently, and during the downside move it broke a bullish trend line formed on the hourly chart of the USDJPY pair. It also settled below the 100 and 50 hourly simple moving average, which is a bearish sign.
The current recovery in the USDJPY pair is facing sellers around the 38.2% Fib retracement level of the last leg from the 107.84 high to 106.67 low.
On the downside, the pair may attempt a retest of the last swing low of 106.67. A break below it could take the pair towards 106.50.
Japanese Eco Watchers Survey
Earlier today in Japan, there were a couple of key releases scheduled. First, the Japanese GDP, which shows the monetary value of all the goods, services and structures produced in Japan was published. The market was a growth of 1.9% in Q1 2016, compared with Q1 2015, and the result was in line with the forecast.
Later, the Eco Watchers Survey, which is closely watches region-by-region economic trends was released by the Cabinet Office. The outcome was not as the market expected, as there was a decline from 43.5 to 43.0 in May 2016.
The US Dollar is currently attempting to recover, but it may face sellers near the 107.15-25 levels.
