The Japanese yen traded against the US dollar Wednesday with a very slight drop as there was little movement on the session during the morning session and we are watching today the completion of Federal Reserve Chairman Jerome Powell's testimony to the US Congress
During the Asian session, the US dollar opened against the Japanese Yen at 110.54, recording the highest of 110.60 and 110.49.
US markets are eyeing the release of the Merchandise Trade Balance, which could reflect a widening deficit to $ 75.3 billion from $ 71.6 billion in November, in conjunction with a reading of the Wholesale Inventories Index, which could show growth accelerating to 0.4 percent. From 0.3% in November.
Before we see the release of housing market data, which may reflect a rise in existing home sales of 0.8% versus a 2.2% drop in December, in conjunction with a factory demand reading which could rise 1.5% from 0.6% in November, Coinciding with the merits of Federal Reserve Governor Jerome Powell's policy on monetary policy before the House Financial Services Committee.
Powell appeared before the Senate Banking Committee on Tuesday as part of his semi-annual testimony on monetary policy to Congress and confirmed what he said at a press conference following the Federal Open Market Committee meeting at the end of last month that the Federal Commission will be patient and monitor economic data in The downside risks to the economy have continued to worsen as global growth and financial market volatility weaken.
As Powell said that the continuation of that approach or not will depend on economic data during the coming period, amid the fact that the economic data confirm that the US economy is in a good position and unemployment rates stabilize at the lowest in half a century, saying that the US economy is close to levels Full employment, adding that he did not see the risks of economic recession high, and that inflation is still below the target of the Federal Commission at two percent.
Technical analysis:
The USD fell against the JPY and managed to breach the support line at 110.59 and close below it
Moving averages are pushing the price lower and pushing it lower especially SMA 50 which is resistance to the price above the previous support line 110.59
The Stochastic is able to exit the oversold area in a sign that a positive pressure on the price prevents it from falling back above the mentioned support level.
The range of support between 110.14 and resistance is 110.96