- SWFX market sentiment is 69% bullish
- 65% of pending orders in a 100-pip range to buy
- Gains could be capped near 111.00
- Upcoming Events: US Building Permits, US Housing Starts, FOMC Meeting Minutes, Japan's Trade Balance
The report on the US worker productivity, which revealed a higher-than-anticipated increase in the Q2, resulted in a jump of the USD/JPY currency pair. The Greenback appreciated against the Yen by 0.07% to be seen trading above the 109.69 level after data were published.
The Labour Department showed that the nonfarm productivity rose at a 0.9% annual growth pace in the June quarter, above expectations for a 0.7% rise. Experts suggested that an upward move was supported by higher volume of hours worked, but the overall trend was seen weak, raising doubts that the robust US economic growth nearing 3% year-over-year would be achieved even despite Trump's tax cuts, regulatory rollbacks and higher infrastructure spending.
FOMC meeting minutes
The economic calendar in this session starts with the US Census Bureau reporting on the number of new residential building permits and housing starts at 1230GMT. Subsequently, the most expected event for today is the release of FOMC meeting minutes at 1800GMT. Finally, the Japanese Ministry of Finance is to publish the country's trade balance for July at 2350GMT.USD/JPY moves above weekly R1
Following a breach of the upper line of the junior channel, the US Dollar continued to appreciate against the Yen near the weekly R1. Further potential upwards was strengthened by solid data mid-session that resulted in a surge up to the 110.80 mark. Subsequently, the rate resumed its up-trend until early morning when the lack of market volatility guided the Greenback sideways. This change in sentiment together with worsening technical indicators demonstrate that the rate is likely to fall today, possibly seeking to retrace from the upper channel line circa 110.00. The 55– and 200-hour SMAs are located near this area. Meanwhile, in case of appreciation, the upside limit is set at the monthly PP at 111.66.Hourly chart
USD/JPY continues its surge for the third consecutive session. The strong appreciation on Tuesday resulted in the pair passing through the weekly R1 and the 20-day SMA circa 110.50. In addition to intraday technical signals, the daily chart demonstrates that a more accurate upside limit today may be the 111.35 area where the 100- and 55-day SMAs are located.
Daily chart
SWFX market sentiment is bullish on Wednesday, as the number of open positions is 69% long (-1%). Furthermore, 57% of pending orders are to buy the US Dollar (-9%).
OANDA clients are likewise bullish on the pair, as 62% of all open positions are long (-5%). Similar viewpoint is held by Saxo Bank clients with 61% long positions (+2%).