The USD/JPY rallied today and has resumed the yesterday’s bullish candle, now is pressuring an important static resistance,a valid breakout will attract more buyers which will drive the price much above the 110.00 psychological level. The dollar redeems ground as the USDX is squeezing after the today’s massive drop.
The dollar index has failed to stay below the 99.50 level, signalling an oversold situation, the rate could increase and a breakout above the 99.84 static resistance will force the dollar to increase further versus its rivals.
The greenback has increased despite the poor US data, most likely is too oversold to stay lower and will try to rebound in the upcoming days, remains to see if will have enough energy to do this, tomorrow we’ll have a busy day as the economic calendar is filled with some important economic data, which will move the price.
The Yen was weakened by the Japanese data, which have come in worse, the Trade Balance has disappointed, the surplus has dropped from 0.61T to 0.17T in March, even if the economists have expected the indicator to remain steady at 0.61T.
The price has increased and has climbed above the 50% retracement level, could climb much higher if will stabilize above this level. Could be attracted by the second warning line (WL2) of the major descending pitchfork, the perspective remains bearish despite the current rebound.
Is on a declining path as long as is trapped below the second warning line (WL2) of the descending pitchfork, the downside targets remain at the 38.2% retracement level and at the first warning line (WL1) of the descending pitchfork, a larger rebound will be favored from there if the US dollar index will jump much higher in the upcoming weeks.
This throwback could be only temporary and the rate could slide further, remains under selling pressure as the Nikkei stock index is approaching a major confluence could send the index down again. Technically the JP225 is expected to drop further, so the Yen could appreciate further versus its major counterparts.