The pair offers a good buy opportunity today.

Today we would take a look at the USD/JPY currency pair. The pair has seen a sharp increase since last week.

The American dollar is currently experiencing some weakness due to President Trump’s aggressive policy on trade and the multiple conflicts this has started. His trade war is not just with China, but also with Canada, Mexico, and the European Union. This is bound to cause some disruptions in international trade, but the full impact of the trade dispute is unclear. Today we expect the June CPI to be released in the United States: this inflation report will be key in determining when we can see another interest rate increase by the Federal Reserve.

The Japanese yen is traditionally seen as a safe haven trading instrument and often gains value in times of trouble. Nevertheless, for now it has been giving in to the dollar, which has led the exchange rate to grow. This is most likely because economic data from Japan continues to be lukewarm, depriving traders of any solid basis for optimism. If the pair starts to decline, it will likely be because of a weaker dollar, rather than a stronger yen.

In terms of the daily chart today we have a pivot point for the USD/JPY pair located at 111.64, with the pair currently trading slightly above it. We expect the rate to stay up today, so look towards the resistances at 112.51 and 113.04. In case the dollar starts losing to the yen, beware of the nearby support levels at 111.11 and 110.24. The indicators of technical analysis indicate a strong buy signal right now and the moving averages agree.