Fundamental Analysis of USD/JPY for July 11, 2017

USD/JPY is currently at the edge of the resistance area of 114.40-115.00. JPY has lost grounds against USD due to bad economic reports published recently. Yesterday JPY Bank Lending report was published with an increase to 3.3% from the previous value of 3.2%, Core Machinery Orders has decreased to -3.6% from previous value of -3.1% which was expected to rise to 1.7% and Current Account report also showed decrease to 1.40T from 1.81T which was expected to be at 1.63T but Economy Watchers Sentiment showed an increase to 50.0 from 48.6 which was expected to be at 49.0. Today JPY M2 Money Stock report was published with an increased value at 3.9% which previously was at 3.8% and Prelim Machine Tool Orders was rise to 31.1% from 24.5%. Despite the positive economic reports, today JPY could not gain over USD yet today which signals the strength of USD over JPY and further gains on the USD side in the coming days. On the USD side, today JOLTS Job Opening report is going to be published which is expected to decrease to 5.98M from previous value of 6.04M, Final Wholesale Inventories is expected to be unchanged at 0.3% and FOMC Member Brainard will speak about nation's key interest rates and future monetary policies. A good amount of volatility is expected to hit the market during the US economic events today and any positive report on USD side will result in further gains against JPY in the coming days.

Now let us look at the technical view, the price is currently residing at the edge of resistance area of 114.40-115.00. As of the recent gains on the USD against JPY further bullish move is expected in this pair but a daily close above 115.00 will confirm the further bullish run with a target towards 120.00 resistance area. On the other hand, if the price rejects off the resistance area of 114.40-115.00 then we might see further bearish move in this pair with a target towards 110.20. The bullish bias is expected to continue until price breaks below the dynamic support of 20 EMA with a daily close.

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