The US Dollar (USD) extended downside movement against the Japanese Yen (JPY) on Wednesday, dragging the price of USDJPY to less than 102.30 following the release of some key economic news. The technical bias already remains bearish because of a Lower Low in the recent downside move.
Technical Analysis
As of this writing, the pair is being traded near 102.23. A support may be noted near 101.20, the horizontal support ahead of 100.00, a major psychological number and then 99.00, the confluence of a horizontal support as well as the swing low of the recent downside move as demonstrated in the following chart.
On the upside, the pair is likely to face a hurdle near 103.57, the horizontal resistance ahead of 105.00, the psychological number and then 106.81, the confluence of a horizontal hurdle as well as the swing high of the latest major upside rally.
US Growth & Consumer Confidence
Final GDP of the US for the first quarter posted a gain of 1.1%, above the estimate of 1.0%. This reading was stronger than the Preliminary GDP reading of 0.8%. Although the upward revision was welcome news, the revised GDP report marked the weakest gain in a year. On the consumer front, CB Consumer Confidence impressed by climbing to 98.0 points, easily beating the forecast of 93.2 points.
Trade Idea
Considering the overall technical and fundamental outlook, buying the pair on dips still appears to be a good strategy in short to medium term.
Trade global forex with the best ECN broker of 2021*. Choose from 50+ forex markets 24/5. Open your FXOpen account now or learn more about making your money go further with FXOpen.
* FXOpen International, best ECN broker of 2021, according to the IAFT
