Today we would take a look at the USD/JPY pair. This pair has been a bit more volatile in the last few days and right now has a mixed outlook.
Japan is currently observing Golden Week. It began on April 27 and will continue until May 6, and during this time the Japanese financial markets will be closed. Because of this extended period of holidays analysts are warning traders to possibly expect a flash crash with the yen. Due to the limited liquidity during the market’s holiday, traders looking to buy the yen (a popular safety asset) will be competing harder with each other, which could very quickly make the yen more expensive, and we are already seeing the USD/JPY in the red this week. Despite a lack of fundamental factors from Japan, beware of such a flash crash.
The American dollar also remains strong on better-than-expected GDP data for the first quarter of 2019, as well as hopes that the trade dispute with China will be resolved soon. According to preliminary reports, we might see the draft for a trade deal between the US and China in just a few weeks.
In terms of the daily chart, we have a pivot point for the pair located at 111.72. The support levels lie at 111.54 and 111.39, while the resistances are located at 111.87 and 112.05. The indicators of technical analysis recommend a strong sell position.
