Today we would direct our attention to the USD/JPY currency pair.
There are a number of reports that could affect the pair in the near future. Today Japan will be releasing its manufacturing PMI data. We are also expecting new information on the inflation rate in Japan, which right now is the key determining factor for the Bank of Japan’s policy making. With the re-election of Shinzo Abe this past Sunday we are likely looking at even bolder stimulus packages and more dovish policy, which would loosen the yen against major currencies.
Meanwhile, we would get a few reports from the United States today such as services and manufacturing PMI data. Investors are keeping a close eye on the dollar because on Friday the United States will release their third-quarter GDP information, which will show how the economy withstood its most stressful period this year.
On the daily chart, today we have a pivot point for the USD/JPY at 113.55. If the pair starts trading below it, look for the support levels at 113.01, 112.72, and 112.21. Conversely, if the USD/JPY is trading above the pivot, it might touch the resistance at 113.85, 114.47, and 114.67. Currently the pair is trading above the pivot around 113.68, so we favor the second scenario. The technical indicators unanimously agree on a strong buy position.
