Today we would take a look at the USD/JPY pair. Recently, the exchange rate for this pair has been moving in an upwards direction.
In general, investors expect that the Japanese yen will continue to be supported by the uncertainty in the global financial markets. None of the main issues troubling the finance world have been resolved: there is still conflict in the Middle East and in Hong Kong, no one knows what would happen with Brexit for certain, and the trade war between the United States and China remains far from over. There are many factors that can cause high risk aversion among investors, which then boost the safety asset yen.
Nevertheless, the USD right now is making a bit of a recovery against the yen, pushing the rate upwards. The reason for this is likely the decision to restart the trade negotiations between the US and China next month. Still, investors are wary that the talks might not lead to any significant results, so market optimism may not last long. In addition, the dollar will likely strengthen if the Federal Reserve announces that they will not cut interest rates in September, which was investors’ understanding.
In terms of the daily chart, we have a pivot point for the pair located at 107.16, with the pair trading below it currently. The support levels lie at 106.96 and 106.57, while the resistances are located at 107.55 and 107.75. The indicators of technical analysis are confidently recommending a strong buy position.
