USD/JPY: Japanese authorities will allocate 2T yen to support th
Current trend
The yen failed to take advantage of the weakness of the US dollar and declined again during the morning session, being around 122.20.
The ruling Liberal Democratic Party, led by Prime Minister Fumio Kishida, has begun discussions on a new emergency financial aid package to support the national economy amid soaring oil and other energy prices. According to preliminary estimates, the financing project may exceed 2T yen, and the deadline for its development is the end of April. It is supposed to include an action plan to stabilize food prices in the document. Meanwhile, data on industrial production again disappointed investors: the figure for February rose by 0.1%, which is much less than the 0.5% increase expected by analysts. The volume of retail sales was significantly worse than expected, which fell by 0.8% compared to an increase of 1.1% a month earlier.
For the first time since the beginning of the month, the USD Index fell below 98.000 on the back of a poor report on the US Q4 GDP. Economic growth amounted to 6.9% instead of price-adjusted expectations of 7.1%. The GDP deflator rose by 7.1%, which is also below the forecast growth of 7.2%. The data from Automatic Data Processing (ADP), according to which Nonfarm Payrolls increased by 455K, which is lower than the increase of 486K a week earlier, did not support the currency.
Support and resistance
The asset is moving within a global uptrend, declining as part of a correction. Technical indicators keep weakening buy signal: indicator Alligator’s EMA fluctuations range began to narrow, and the histogram of the AO oscillator formed the first bar with a downward trend.
Support levels: 121.20, 118.20.
Resistance levels: 122.90, 125.00.
The yen failed to take advantage of the weakness of the US dollar and declined again during the morning session, being around 122.20.
The ruling Liberal Democratic Party, led by Prime Minister Fumio Kishida, has begun discussions on a new emergency financial aid package to support the national economy amid soaring oil and other energy prices. According to preliminary estimates, the financing project may exceed 2T yen, and the deadline for its development is the end of April. It is supposed to include an action plan to stabilize food prices in the document. Meanwhile, data on industrial production again disappointed investors: the figure for February rose by 0.1%, which is much less than the 0.5% increase expected by analysts. The volume of retail sales was significantly worse than expected, which fell by 0.8% compared to an increase of 1.1% a month earlier.
For the first time since the beginning of the month, the USD Index fell below 98.000 on the back of a poor report on the US Q4 GDP. Economic growth amounted to 6.9% instead of price-adjusted expectations of 7.1%. The GDP deflator rose by 7.1%, which is also below the forecast growth of 7.2%. The data from Automatic Data Processing (ADP), according to which Nonfarm Payrolls increased by 455K, which is lower than the increase of 486K a week earlier, did not support the currency.
Support and resistance
The asset is moving within a global uptrend, declining as part of a correction. Technical indicators keep weakening buy signal: indicator Alligator’s EMA fluctuations range began to narrow, and the histogram of the AO oscillator formed the first bar with a downward trend.
Support levels: 121.20, 118.20.
Resistance levels: 122.90, 125.00.