USDJPY, H1
USDJPY is higher today, having lifted above Wednesday’s 110.49 high as global stock markets rebounded, causing an unwinding of the Japanese currency’s safe haven premium. EURJPY and AUDJPY, among other Yen crosses, also strengthened. China’s PBoC said today it would use comprehensive policy tools to maintain positive economic developments and stabilize market expectations. USDJPY remains in a broadly choppy, sideways range, which has been unfolding over the last eight weeks. More of the same looks likely, with fundamentals (Fed versus BoJ policy paths) bullish but offset by the risks stemming from a deepening and prolonged trade war among major economies, a backdrop that has the Japanese currency in demand as a safe haven.
The intra-day H1 chart broke the key 20 period moving average at 17:00 yesterday at 110.30 and continues to trend higher. A breach of 110.76 and R1 is required if the pair is to move higher today; next Resistance sits around 110.86 and the key psychological 111.00. Support is around 110.55 (20 period moving average), the daily pivot point at 110.35 and the 200 period moving average and S1 level around 110.10 .
The daily chart has Support at the 200 period moving average and 23.6 Fibonacci zone, 109.80-60 with Resistance at the top of the channel at 111.00 and the recent high from May at 111.39.
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Stuart Cowell
Senior Market Analyst
HotForex
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