USD/JPY to see further gains above 107.70

USD/JPY is pressuring daily highs, near 107.40, and neutral-to-bullish in the short-term. The pair could extend its advance in the short-term, and gain further momentum if clears the resistance at 107.70, FXStreet’s Chief Analyst Valeria Bednarik reports.

Key quotes

Data coming from Japan didn’t help the yen, as the country’s May industrial production contracted by 8.9% when compared to April, and fell 26.3% yearly basis. Capacity Utilization in the same month was down by 11.6%. The macroeconomic focus shifts now to US inflation, as the country will publish June CPI numbers today. The headline figure is seen at 0.6% YoY, while core inflation is foreseen at 1.1% in the same month, down from 1.2% in May.

“In the 4-hour chart, technical indicators head firmly higher within positive levels, reflecting increased buying interest, although the price is trapped between directionless moving averages, with the 200 SMA flat at around 107.50.” 

“The USD/JPY pair has multiple intraday highs from these last few days in the 107.70 price zone, that needs to be cleared to see the pair gather additional momentum.”