USD/JPY has been quite impulsive with the bearish momentum recently which lead the price to open below 110.50 today. As the break below 110.50 was with a gap, the breakout cannot be taken as optimum for further bearish pressure in the pair.
This week JPY Trade Balance report is going to be published on Thursday, which is expected to decrease to 0.02T from the previous figure of 0.07T. The pessimist forecast of the JPY's only impactful news this week may lead to certain weakness on the JPY side this week against USD in the process.
On the other hand, having no economic report or event today to impact the market on the USD as well, this week on Wednesday, Retail Sales report is going to be published which is expected to decrease to 0.2% from the previous value of 0.5% and Core Retail Sales report is expected to be unchanged at 0.4%. Moreover, on Thursday, USD Building Permits report is going to be published which is expected to have a slight increase to 1.31M from the previous figure of 1.29M in the process.
As of the current scenario, though JPY has been leading with certain gains recently, the bearish momentum is expected to fade away if USD performs better than expected in the upcoming economic reports to be published this week which is more likely to take place.
Now let us look at the technical view. The price is currently residing below 110.50 and also at the edge of Kumo Cloud support whereas a daily close above 110.50 is expected to lead the price towards 112.00 resistance area in the coming days. As the price remains above 108.50-109.20 area, the bullish bias is expected to continue further.
SUPPORT: 108.50-109.20
RESISTANCE: 112.00
BIAS: BULLISH
MOMENTUM: VOLATILE
