USDJPY trades 0.09% higher at 109.96 close to seven month highs. The pair recovers some of yesterday’s losses which attributed to strong bids from traders looking for safe haven assets after the outbreak of the coronaryvirus outbreak in China and other countries. On the economic data front the United States Chicago Fed National Activity Index came in at 0.56, topping forecasts of -0.3 in December. The U.S. Redbook Index jumped from previous -0.2% to 0% in January 17.
The Japanese Yen is under pressure since the signing of the Phase One trade deal between the US and China. The Bank of Japan yesterday kept its monetary policy unchanged, and also the forward guidance unchanged while revised higher the GDP growth forecasts.
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USDJPY Technical Analysis
USDJPY is under selling pressure mostly due to profit taking after the pair hit seven month highs. In a critical session today if the pair adds higher it will enhance the positive momentum and might initiate another leg higher.
USDJPY momentum is bullish as it trades above all major daily moving averages. On the upside the pair will meet resistance at 110.09 the daily top. Next resistance stands at 110.28 the high from January 17th. A break above might drive the price up to 109.92 the high from May 26th.
On the downside initial resistance stands at 109.82 the daily low. More offers might emerge at 109.49 the low from January 13th. A break below the 50-day moving average at 109.14 would cancel the bullish momentum and bear might push the pair lower.
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