USD/JPY holds above 106.50 as Wall Street rebounds
- The ADP Employment Change and ISM Non-Manufacturing PMI are set on Wednesday at 12:15 GMT and 14:00 GMT respectively.
- The USD/JPY is closely following the US Dollar Index as of late.
The USD/JPY is trading at around 106.62 up 0.32% on Tuesday as the New-York session is about to come to an end. The yen lost its safe-haven appeal as trade war tension between the US and China have been shrugged-off by investors globally and news that “the Trump administration is not actively seeking to act on the president’s perceived problems with Amazon.com Inc” according to Bloomberg.
US stocks rebounded with all the three main indices, the S&P 500, the Nasdaq and the Dow Jones trading in positive territory ahead of the close of the day. Therefore lessening the demand for the yen, which is often bought it times of stock markets pullbacks.
Coming up next is the US ADP Employment Change on Wednesday, the precursor of the Non-Farm Payroll on Friday along with the ISM Non-Manufacturing PMI for March.
The USD/JPY has been pretty much taking its cues from the US Dollar Index since March as shown in the graph below. The green line is for the greenback.
USD/JPY vs US Dollar Index
USD/JPY weekly chart
The USD/JPY is trading below its 50, 100 and 200-period simple moving average on the weekly chart. The bulls are trying to break above the high of last week established at 107.03. The RSI is at 40.96 and the MACD is showing slowing bearish momentum.
USD/JPY daily chart
Resistance is seen in the 107-107.25 area with the big figure and the 50-period simple moving average, respectively. A break would lead to 108.40, the 38.2% Fibonacci retracement from the November 2017-March 2018 bear trend. The RSI is at 50.98 and the MACD is currently constructive to the upside.
USD/JPY 4-hour chart
The USD/JPY is trading above its 50, 100 and 200-period SMA with the RSI and MACD indicators constructive to the upside. Support is seen at 105.65 intraday swing low and at 104.63 cyclical low.