Key Points
- The US Dollar declined this week below the 109.50 support against the Japanese Yen.
- There are two bearish trend lines forming with resistance at 108.80 and 109.00 on the hourly chart of USDJPY.
- Recently in Japan, the Labor Cash Earnings figure for July 2017 was released by the Ministry of Health, Labour and Welfare.
- The outcome was below the forecast of +0.5%, as there was a decline of 0.3% in the Labor Cash Earnings.
USDJPY Technical Analysis
The US Dollar after trading briefly above the 110.00 level against the Japanese Yen failed to hold the bullish bias and started a downside move. The USDJPY pair declined and traded below the 109.50 support and the 21 hourly simple moving average.
The pair even traded below the 109.00 handle and recently traded as low as 108.50. The mentioned 108.50 support is important, which is why the pair could correct higher. An initial resistance is around the 23.6% Fib retracement level of the last decline from the 109.80 high to 108.47 low.
Moreover, there are two bearish trend lines forming with resistance at 108.80 and 109.00 on the hourly chart of USDJPY. The second trend line at 109.00 is also near the 38.2% Fib retracement level of the last decline from the 109.80 high to 108.47 low.
Japan’s Labor Cash Earnings
Today in Japan, the Labor Cash Earnings figure for July 2017 was released by the Ministry of Health, Labour and Welfare. The market was positioned for a rise of 0.5% in the earnings compared with the same month a year ago.
The actual result was below the forecast of +0.5%, as there was a decline of 0.3% in the Labor Cash Earnings. On the other hand, there was a revision in the last reading from -0.4% to +0.4%.
Overall, the USDJPY pair might continue to struggle and any corrections towards the 109.00 level remains capped.
