Today during the Asian session, the USD / JPY pair is slightly declining, testing for a breakdown of the support at 103.00.
The US dollar is not expected to be in demand in the first hours of the new trading calendar year, playing back the previous negative factors. At the end of December, the administration of the current US President Donald Trump was able to agree on the details of a new financial support plan for the American economy, which is in a difficult situation against the backdrop of a difficult epidemiological situation. The dollar is now facing a change of power, but analysts say President-elect Joe Biden’s initial course is unlikely to change much.
At the beginning of the week, some support for the Japanese yen was provided by positive national macroeconomic statistics. So, the PMI in the manufacturing sector from Jibun Bank rose from 49.7 to 50 points.
Support and resistance levels
On the daily chart, the Bollinger Bands are moderately declining. The price range changes insignificantly, however, it hardly keeps pace with the development of the bearish dynamics in the short term. The MACD indicator is going down, maintaining a relatively strong sell signal (the histogram is below the signal line). Stochastic is showing similar dynamics, rapidly approaching the 20 level, which may indicate growing risks of the dollar being oversold in the ultra-short term.
The current readings of technical indicators do not contradict the further decline in the dollar rate in the next time intervals.
- Resistance levels: 103.25, 103.39, 103.64, 103.90
- Support levels: 103.00, 102.80, 102.50
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