Fundamental Analysis of USD/JPY for May 7, 2018

USD/JPY has been non-volatile and impulsive with the bullish gains recently which is expected to extend its horizons further upwards in the coming days. Despite the mixed economic reports of USD published on Friday, the currency managed to gain momentum today in an impulsive manner which is expected to push the price higher in the future.

Today JPY Monetary Policy Meeting Minutes were held which did not quite help the JPY to gain momentum against the impulsive bullish pressure of USD. This week, certain impactful economic reports and events on the JPY side is going to be published where the outcomes are forecasted to have mixed results in the coming days.

On the USD side, today FOMC Member Bostic and Barkin are going to speak about the upcoming interest rates decision which is expected to be quite neutral in nature and Consumer Credit report is going to be published which is expected to increase to 16.2B from the previous figure of 10.6B. Additionally, tomorrow Fed Chair Powell is going to speak tomorrow about the economic developments, interest rates and upcoming monetary policy which is expected to have a greater impact on the upcoming price action of the market and may result in further gains on the USD side against JPY in the coming days.

As of the current scenario, USD is expected to strengthen itself further against JPY despite the upcoming economic reports results to be published this week. The market sentiment seemed to be on the USD side whereas Bank of Japan is currently looking at the long-term growth leading to slower gains on the JPY side in the coming days. To sum up, USD is expected to have an upper hand on JPY in the coming days of the week.

Now let us look at the technical view. The price is currently residing at the edge of 109.20 resistance area from where the price is expected to push higher towards 110.50 and later towards 112.00 area in the future. The price is being supported by the dynamic level of 20 EMA alongside the horizontal support area of 108.50-109.20. As the price remains above 108.50 area with a daily close, further bullish momentum is expected in the future.

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The material has been provided by InstaForex Company - www.instaforex.com