Current Dynamics
The USD/JPY pair is showing moderate growth, with a short-term upward movement that started gaining strength since last week when it bounced back from local lows since May 16. The quotes are testing the resistance at 157.15, while market participants analyze the recent statistics from Japan.
The Gross Domestic Product (GDP) for the first quarter showed an annual contraction of 1.8%, a slight improvement from the previous -2.0%, but still below the expected -1.9%. Quarterly, there was a decrease of 0.5%. Additionally, bank credit volumes slowed from 3.1% to 3.0%, contrary to neutral forecasts. The Eco Watchers Current Conditions index dropped from 47.4 to 45.7 points in May, against an expected rise to 48.9 points. The outlook for future events also fell from 48.5 to 46.3 points. Japanese household spending decreased by 1.2% in April, instead of increasing by 0.2%, and annually, the indicator rose only by 0.5% against an expectation of 0.6%. Although there was positive momentum for the first time in 14 months, experts point out that consumption in the Japanese economy remains weak, which could hinder the rise of inflation and subsequent adjustments to reference rates by the Bank of Japan. Today, Finance Minister Shunichi Suzuki stated that monetary interventions should be conducted with moderation, considering their necessity and effectiveness.
Meanwhile, the US dollar remains strong, supported by a robust US labor market report released last Friday. In May, the US economy created 272,000 new jobs outside the agricultural sector, surpassing the expectation of 185,000 and the previous increase of 165,000. The average hourly wage accelerated from 4.0% to 4.1% annually, exceeding the forecast of a slowdown to 3.9%, and monthly it rose from 0.2% to 0.4%, against an expectation of 0.3%. This report will influence the Federal Reserve's (Fed) decisions on reference rates. The next meeting will be on Wednesday, June 12, and although investors are confident that interest rates will remain at 5.50%, updated forecasts could slightly influence market activity.
Support and Resistance Levels
On the daily chart, Bollinger Bands indicate a reversal to a horizontal plane, with the price range remaining stable despite short-term upward momentum. The MACD indicator is reversing upward, forming a new buy signal (histogram above the signal line). The Stochastic shows firm growth but is quickly approaching maximum levels, indicating the risk of overvaluation of the dollar in the short term.
Resistance Levels:
157.50
157.98
158.43
159.00
Support Levels:
157.00
156.50
156.00
155.50
Trading Scenarios
Buying: Positions can be taken after breaking the 157.50 level upwards, targeting 158.43. Set a Stop Loss at 157.00. Time frame: 1-2 days.
Selling: A bounce from the 157.50 level as resistance, followed by breaking the 157.00 level downwards, could signal new selling positions targeting 156.00. Set a Stop Loss at 157.50.
The USD/JPY pair is showing moderate growth, with a short-term upward movement that started gaining strength since last week when it bounced back from local lows since May 16. The quotes are testing the resistance at 157.15, while market participants analyze the recent statistics from Japan.
The Gross Domestic Product (GDP) for the first quarter showed an annual contraction of 1.8%, a slight improvement from the previous -2.0%, but still below the expected -1.9%. Quarterly, there was a decrease of 0.5%. Additionally, bank credit volumes slowed from 3.1% to 3.0%, contrary to neutral forecasts. The Eco Watchers Current Conditions index dropped from 47.4 to 45.7 points in May, against an expected rise to 48.9 points. The outlook for future events also fell from 48.5 to 46.3 points. Japanese household spending decreased by 1.2% in April, instead of increasing by 0.2%, and annually, the indicator rose only by 0.5% against an expectation of 0.6%. Although there was positive momentum for the first time in 14 months, experts point out that consumption in the Japanese economy remains weak, which could hinder the rise of inflation and subsequent adjustments to reference rates by the Bank of Japan. Today, Finance Minister Shunichi Suzuki stated that monetary interventions should be conducted with moderation, considering their necessity and effectiveness.
Meanwhile, the US dollar remains strong, supported by a robust US labor market report released last Friday. In May, the US economy created 272,000 new jobs outside the agricultural sector, surpassing the expectation of 185,000 and the previous increase of 165,000. The average hourly wage accelerated from 4.0% to 4.1% annually, exceeding the forecast of a slowdown to 3.9%, and monthly it rose from 0.2% to 0.4%, against an expectation of 0.3%. This report will influence the Federal Reserve's (Fed) decisions on reference rates. The next meeting will be on Wednesday, June 12, and although investors are confident that interest rates will remain at 5.50%, updated forecasts could slightly influence market activity.
Support and Resistance Levels
On the daily chart, Bollinger Bands indicate a reversal to a horizontal plane, with the price range remaining stable despite short-term upward momentum. The MACD indicator is reversing upward, forming a new buy signal (histogram above the signal line). The Stochastic shows firm growth but is quickly approaching maximum levels, indicating the risk of overvaluation of the dollar in the short term.
Resistance Levels:
157.50
157.98
158.43
159.00
Support Levels:
157.00
156.50
156.00
155.50
Trading Scenarios
Buying: Positions can be taken after breaking the 157.50 level upwards, targeting 158.43. Set a Stop Loss at 157.00. Time frame: 1-2 days.
Selling: A bounce from the 157.50 level as resistance, followed by breaking the 157.00 level downwards, could signal new selling positions targeting 156.00. Set a Stop Loss at 157.50.