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USDJPY : The pair Might Continue to Extend Gains

USDJPY : Daily Chart

USDJPY seems like planning to break above the key resistance at 103.01 on the Daily Chart. Breaking this resistance the pair may rise up to the next resistance at 103.77. Earlier the 100 day SMA crossing below the 200 day SMA was giving a bearish signal but today it changed its direction and has now turned to move in the same upward direction as 200 day and 50 day SMA are moving signaling that the pair will continue to follow the uptrend.

The pair got it surge from yesterday’s upbeat Advance GDP report. Today the Department of Labor said that the number of people who applied for U.S. unemployment benefits rose by 23000 last week to 302000 in the week ending July 26 from the 14 year low reading. However the level still remains near the post-recession bottom and continue to show that the labor market is improving. The 4 week moving average which is considered as the better gauge for the labor market declined by 3,500 to 297,250 from the previous week’s revised reading. This is the lowest level for this average since April 15, 2006 when it was 296000.

USDJPY : 4 Hour Chart

So we can say that the labor market is showing improvement and bullish expectations among investors will help pushing the dollar higher against yen. On the 4 Hour chart, the pair seems supported by a rising support trend line which will prevent the pair to fall below it.