The Japanese yen is consolidating in a range of 108.20-109.20 for the sixth session.
The pair needed support from the US stock market to go up, and now it has received this support.
Yesterday the Dow Jones rose by 1.0%. Today Nikkei225 adds 0.74%. Yesterday, the Japanese economic indicators came out weak, which allowed the pair USD/JPY to add 40 points.
The monthly PPI fell by 0.3%. Today the situation has changed for the better. The industrial production has added 3.8% vs. 3.6%. Tomorrow, Japan will publish data on GDP for the 1st quarter of the 2nd assessment. It’s expected the revision from -0.3% to + 0.1%. The annual GDP is projected to rise by 0.3% vs. -1.1% previously.
The private consumption is forecasted to grow by 0.2% vs. - 0.9%. We believe that the market is ready to see the pair USD/JPY at around 110.65.
How to trade
The pair USD/JPY has the key levels: 109.93, 109.34, 108.38. The continuation of the upward movement is possible after the break of 109.35, in this case, the target is 109.93. We would buy call options if the pair rises above 109.35.
Target price: 109.35
Expiry time: 20:00 GMT