Important data Wednesday for the US and Japanese economies sets up potential for a significant USDJPY move.
The Tankan Manufacturing and Non-Manufacturing Indexes are due from Japan, expected at 14 and 17 respectively, whilst the Final Manufacturing PMI is also due at 50.4.
From the US, we see the ADP Non-Farm Employment Change (forecast 226K) and SM Manufacturing PMI (expected at 52.5) as key.
USDJPY bullish bias
A stall Tuesday just ahead of the trend line (120.40) and higher targets at 120.60/65, but the rebound effort leaves upside pressures intact whilst above 119.64 support.
Last week saw a shift to a broader range theme, but a rebound from ahead of key 118.15 support rejected a more bearish shift. Price action this week leaves risk for a bull tone again above 121.40.
For Today:
- We see an upside bias for the trend line (120.40); break here aims for 120.60/65, maybe 121.20/22.
- But below 119.64 opens risk down to 119.09, maybe 118.90, which we would look to try to again hold.
Short-/ Intermediate-term Range Levels: We continue to see the broader range defined by 121.20 and 118.15.
Range Breakout Challenge
- Upside: Above 121.20 aims higher for the new 122.02 peak and to a key long term retracement at 122.45.
- Downside: Below 118.15 sees risk lower for 117.17 and 116.64.
Daily Chart
4 hour Chart
