Today we would take a look at the USD/JPY currency pair. After a minor decline over the past couple of days, the pair turned to growth yesterday again.
In terms of the American dollar, not much has changed. Economic reports continue to show strength, and the Federal Reserve is committed to a hawkish monetary policy, with two rate hikes planned for the remainder of 2018. However, the most recent Fed meeting minutes revealed a bit less confidence. This is likely due to the piling of political pressures: the ongoing trade was with China that seems irresolvable, the somewhat newer conflict with Turkey, and the scandals inside of the White House, plus the ongoing Russia probe. These all make the political climate in the US appear very shaky and the economy might be exposed to risks because of it.
Things continue without much change for the Japanese yen as well. The Bank of Japan is maintaining a steady course, even as they are readying to cut stimulus if they see inflation rising. The yen recently appreciated against most currencies due to the problems associated with the drop of the Turkish lira. If there is more stress there, the yen will likely rise again because it is best equipped as a safety asset in those cases.
In terms of the daily chart today we have a pivot point for the USD/JPY pair located at 111.54, with the pair currently trading slightly above it. We expect the rate to continue rising, so look towards the nearby daily resistance levels at 111.96 and 112.24. In case the yen strengthens, look to the supports at 111.26 and 110.84. The indicators of technical analysis recommend a strong buy position.
