The US dollar fluctuated in a narrow uptrend range during the Asian session to witness the bounce for the third session in five sessions from the lowest since January 3 last amid the lack of economic data by the Japanese economy and on the threshold of developments and economic data by the US economy the world.
At 05:51 AM GMT, the USDJPY rose 0.02% to 106.14 levels from 106.12 opening levels, after hitting a session high of 106.27 and a low of 106.03.
Investors in the US economy are awaiting the release of the housing market data with the release of the Housing Starts and Building Permits for July. Building permits are expected to rise 3.1% to 1.27 million versus a decline of 6.1% at 1.23 million in June. June starts may show a rise of 0.2% to 1.26 million versus a decline of 0.9% at 1.25 million.
This comes ahead of the preliminary reading of the University of Michigan's consumer confidence index, which may reflect a shrinking expansion to 97.2 vs. 98.4 in July. Otherwise, US President Donald Trump yesterday continued his criticism of the Federal Reserve for interest on federal funds, saying it was delayed In reducing them to support the American economy, adding that imposing tariffs on China did not harm the economy, but made billions of dollars for his country.
It is noteworthy that the US Treasury announced last Tuesday to postpone the date of activating the imposition of customs tariffs 10% on US imports of some Chinese goods until December 15, which was supposed to enter into force by the beginning of next month, and then heavier on the performance The safe-haven yen, which fell against the dollar by more than 1 percent, was the pair's best daily performance since March 28, 2018.
Technical Analysis
USDJPY tested a new 106.70 level yesterday and bounced lower from there, settling around SMA 50, waiting for further declines to continue the bearish main trend, with targets starting at 105.05 then 104.60.
Stability below 106.70 is important to achieve the suggested targets, as a breach will push the price to achieve more intraday gains that reach 107.70 mainly.
Expected trading range for today is between 105.20 support and 106.70 resistance.
Expected trend for today: Bearish.