Solid News
USDJPY Recovers after Last Week's Decline
12/12/2022 10:14 AMThe US dollar is trading with upward dynamics, testing the level of 137.00 for a breakout, and the "bulls" are waiting for new drivers of movement in the market.
Investors are focused on the November statistics on consumer inflation, which will be published on Tuesday, December 13, as well as the results of the two-day meeting of the US Federal Reserve, which will be released the next day. Analysts expect the annual dynamics of consumer prices to remain at the same level of 7.7%. In turn, the regulator is likely to raise the rate by only 50 basis points, thus changing the existing correction plan in increments of 75 basis points.
The yen is slightly supported by relatively positive macroeconomic statistics on producer inflation. Producer Price Index in November rose by 0.6% after rising by 0.8% in the previous month, while analysts had expected a slowdown in dynamics to 0.5%. The Domestic Corporate Price Index corrected from 9.4% to 9.3%, while the market expected a decline to 8.9%. At the same time, the BSI Large Manufacturing Conditions Index for the fourth quarter decreased by 3.6% after an increase of 1.7%, with a forecast of maintaining a minimum growth of 0.1%. Experts note the high potential for the recovery of the Japanese economy in the current quarter amid the easing of sanctions restrictions on the supply of semiconductors and cars, as well as the abolition of border controls due to COVID-19, which, in turn, will increase tourist flows both from abroad and inside the country. This will boost private consumption, helping the economy return to growth in October-December.
Bollinger Bands in D1 chart demonstrate a stable decrease. The price range is narrowing, reflecting ambiguous dynamics of trading in the short term. MACD indicator is growing, while preserving a rather stable buy signal (located above the signal line). Stochastic, having approached the level of "80", reversed into a horizontal plane, reflecting the multidirectional dynamics of trading in recent days.
Resistance levels: 137.50, 138.50, 139.58, 140.79. | Support levels: 136.50, 135.57, 134.78, 133.61.
