The USD/JPY currency pair on Friday pulled back off the current monthly highs of about 110.204 to trade at around 109.851. This came following the latest round of the US and Japanese data. The currency pair remains pinned within a gently ascending channel formation in the 60-min chart.
The pair is trading several levels above the 100-hour moving average. Friday’s late pullback pushed the currency pair from overbought levels and back to the normal trading zone of the 14-hour RSI.
USD/JPY Fundamentals Overview
From a fundamental perspective, the USD/JPY currency pair is trading at the back of a relatively busy period in both markets. On Friday, the Japanese unemployment rate for April inched higher to 2.8% up from 2.6% in the previous reading. The market was expecting a rate of 2.7%. The jobs/applicants ratio edged lower to 1.09 down from 1.1 missing the expectation of 1.1. The CPI ex-food and energy for May also came short of the expected (YoY) change of 0.1% with a change of -0.1%. General CPI outshone -0.8% with -0.4% (YoY).
In the US, personal income for April beat the expected (MoM) change of -4.1% with a change of -3.1%. Personal spending was in line with 0.5% while the core personal expenditures price index matched 0.6%. On the other hand, the Chicago purchasing managers’ index for May beat the expectation of 68 with 75.2 while the Michigan consumer sentiment was in line with 82.9.
USD/JPY Technical Analysis (the 60-min Chart)
Technically, the USD/JPY currency pair appears to have recently pulled back after a sharp climb. The pair continues to trade within an ascending channel formation in the 60-min chart. This indicates a significant short-term bullish bias in the market sentiment.
The bulls will be looking to ride the current bull-run towards 110.204 or higher to 110.516. On the other hand, the bears will target pullbacks at around 109.520 or lower at 109.164.
USD/JPY Technical Analysis (the Daily Chart)
In the daily chart, the USD/JPY currency pair appears to be trading within a sharply ascending channel formation. The pair moved closer to overbought levels on Friday before the late pullback. This indicates a strong long-term bullish bias in the market sentiment.
The bulls will target long-term profits at around 111.562 or higher at 113.568. On the other hand, the bears will look to pounce for potential pullbacks at around 107.709 or lower at 105.746.