USD/JPY has been quite impulsive with bullish gains recently which led the price towards 112.00 resistance area with a daily close. Despite a series of downbeat economic reports from the US recently, USD managed to gain momentum over JPY that indicates certain weakness of JPY in the process.
After a series of high impact disappointing economic reports from the US like PPI, CPI and Retail Sales, USD is quite weak fundamentally and expected to remain indecisive as no high impact economic report is going to be published today. Today US Empire State Manufacturing Index report is going to be published which is expected to decrease to 23.2 from the previous figure of 25.6. Additionally, this week on Wednesday Building Permits is expected to be unchanged at 1.31M and Housing Starts is expected to increase to 1.24M from the previous figure of 1.17M.
On the other hand, Japanese banks are closed today due to the observance of Aged Day. However, despite a bank holiday JPY managed to sustain the momentum over USD in the process. The BOJ Monetary Policy Statement and BOJ Policy Rate decision which is expected to be unchanged at -0.10% may lead to certain volatility in the pair for the week.
Meanhwile, the economic calendar lacks macroeconomic reports from the US, thus the pair will sustain further impulsive gains in the process this week. Data from Japan is going to provide the required momentum and determine market sentiment.
Now let us look at the technical view. The price is currently residing at the edge of 112.00 area from where a daily close above 112.00 area is expected to provide the required momentum for the price to push higher with target towards 113.00 area in the coming days. As the price remains above 110.50 area with a daily close, the bullish bias is expected to continue further.
SUPPORT: 110.50
RESISTANCE: 112.00, 113.00
BIAS: BULLISH
MOMENTUM: NON-VOLATILE and IMPULSIVE
