USD/JPY was held below 119 last week, but after a brief consolidation looks ready for bullish continuation. Let’s take a look at the 1H chart.
After retreating from 119 to 117.35, the market found support and rallied back above 118.00. This signaled bullish continuation but we should expect some slowdown of the rally ahead of tomorrow’s US GDP data for Q3. This will be the preliminary, or 2nd estimate and it is expected to slide slightly to 3.3% from the first, advanced estimate that it would be 3.5%. Price is likely to spring up if the GDP reading is above 3.3%, especially if the revision is suppose to be upwards, above 3.5%. Look for 120 as the next key level for USD/JPY. However, if GDP is lower than 3.3%, and price holds below 119, look at 118 for more clue. If price can hold above, the bullish market is still in play. Otherwise, look for further consolidation with downside risk towards 117.35 and 117.00.
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