• The downside pressure remains high as long as it stays below the upper median line.
• Taking out the pivot point activates more declines.
• The US and Japanese figures could have a significant impact tomorrow.

The USD/JPY price dropped as low as 147.70 today, where it found demand again. Now, it has turned to the upside and is trading at 147.98 at the time of writing.

The pair tumbled as the US dollar lost traction from a one-week top. After yesterday’s sell-off, the pair is rebounding.

Yesterday, the Japanese Average Cash Earnings and Household Spending came in worse than expected, while the US RCM/TIPP Economic Optimism was reported lower at 44.0 points compared to 47.2 points forecasts.

Today, the Japanese Leading Indicators came in at 110.0%, above the estimated 109.4%. On the other hand, the Trade Balance could jump from -63.2B to -62.0B. The greenback needs strong support from the US economy to be able to come back higher.

Tomorrow, Japan will release the Current Account, Bank Lending, and the Economy Watchers Sentiment, while the US will publish the Unemployment Claims and the Final Wholesale Inventories. Only better-than-expected Japanese data could help the Yen extend its short-term growth.

From the technical point of view, the USD/JPY price turned to the downside after failing to take out the former high of 148.82. It slumped after retesting the descending pitchfork’s upper median line (uml).

Now, it has found support on the 50% Fibonacci line of the descending pitchfork, signaling exhausted sellers. It has failed to reach the weekly pivot point of 147.59, indicating a potential bounce back.

Still, the price could drop deeper if it stays below the upper median line. However, only taking out the 50% Fibonacci line and the pivot point validates more declines towards the median line (ml).

https://www.forexcrunch.com/blog/2024/02/07/usd-jpy-price-pause-downside-albeit-resisted-by-148-00/