USD/JPY Rallies After Japan’s Trade Balance News

FXOpen

The US Dollar (USD) inched higher against the Japanese Yen (JPY) on Monday, increasing the price of USD/JPY to more than 111.50 following the Japan’s trade balance news. The technical bias remains bullish because of a higher high in the recent upside move.

Technical Analysis

As of this writing, the pair is being traded around 111.49. The pair is expected to face a hurdle near 113.31, the 50% fib level ahead of 114.19, the upper trendline as demonstrated with brown color in the given above chart and then 115.50, a long term resistance level on daily chart.

USD/JPY Rallies After Japan’s Trade Balance News

On the downside, a support may be seen near 110.44, the 23.6% fib level ahead of 110.00, the psychological number and then 109.12, a short-term horizontal support area. A break and daily closing below the 109.12 support shall incite more selling pressure in the long run. The technical bias shall remain bullish as long as the 109.12 support area is intact.

Japan Trade Balance

Japan’s exports rose in April to mark their fifth straight month of gains, as shipments of semiconductors and steel expanded, signaling that more robust overseas demand could underpin a steady economic recovery. Exports rose 7.5 percent in April from a year ago, below the median estimate of 7.8 percent annual growth, finance ministry data showed on Monday. It followed a 12.0 percent rise in March. The data also showed Japan’s trade surplus with the United States narrowed. Exports to the United States increased 2.6 percent in April from a year ago, gaining for the third straight month due to larger shipments of cars and auto parts. But Japan’s trade surplus with the United States fell 4.2 percent in April from a year ago to 586.7 billion yen ($5.27 billion).

Trade Idea

Considering the overall technical and fundamental outlook, buying the pair around current levels can be a good strategy in short to medium term.

 

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