The USDJPY pair was little changed today as traders react to the disappointing trade numbers from Japan. The pair is trading at 107.24, which is within the range it has been in the past few weeks. As a result, its volatility has dropped to the lowest level since March.
Japan trade numbers disappoint
As an export-oriented economy, Japan makes most of its money from exports. The country is widely known for its industrial goods like automobiles and engines. Therefore, data released by the Ministry of Finance showed that the country’s exporters sold less goods than they did in the previous month.
In total, exports declined by 26.2% in June after dropping by 28.3% in the previous month. The country exported goods worth more than 4.86 trillion yen, up from 6.585 trillion yen. Most of the drop was exports to the United States and Canada. That was the 19th straight month of falling exports from the country.
Meanwhile, imports declined to more than 5.1 trillion yen from the previous 5.9 trillion yen. As a result, the trade deficit declined to 268 billion yen in June.
The data came as the country’s tensions continued. According to the Nikkei, the government has unveiled a multibillion fund to lure Japanese companies that are operating in China. The data came a week after the BOJ left interest rate unchanged.
With no other major data from Japan and the US, the USDJPY pair is likely to remain in the current range today.
USDJPY technical outlook
The USDJPY pair is trading at 107.24. On the daily chart, this price is slightly below the 100-day and 50-day exponential moving averages. The price is also slightly below the 61.8% Fibonacci retracement level on the daily chart while its volatility has eased.
Therefore, I expect the pair will continue in this consolidation in the near term. The main levels to watch will be the resistance level at 108.00 and support at 106.68.