The trading session that started in Tokyo, Japan, on Tuesday was not a good sign for the USD/JPY pair. The pair ended up trading at a lower level, moving as low as 133.00 according to the intraday data.
USD/JPY Pair Pulled to 133.00
It was on Tuesday when the trading pair ‘USD/JPY’ moved into the negative zone. It ended up trading lower coming all the way down to 133.00. It was during the Tokyo session that the trading value of the pair dipped to a particular level.
It is because of two major factors that the trading value of the USD is losing its power against the JPY.
The first factor is the US Treasury yields. According to the latest data shared by the US Feds, the yield data for the US Treasury has been at lower levels.
The second factor is fear among the investors and economists, which is not letting the USD perform well. The fear is mainly due to the possibility of a recession.
The investors fear that they may end up facing a recession and they are neither feeling confident nor comfortable supporting the USD.
The two factors are currently holding the investors from going all out in support of the USD/JPY pair. As a result, the Japanese yen has started to gain momentum against the dollar.
USD/JPY is Still Weak
It was just recently when a rebound was recorded in the trading value of the USD/JPY pair. However, it did not mean that the rebound was a significant one.
It did not do enough or much in favor of the USD as the pair still remained weak, and needed more help from bullish investors.
It’s been the second consecutive day the trading value of the pair has continued moving downwards. It is because the fears of economic conditions are hovering over both the US and the Chinese economies.
The investors are also being very cautious about the latest meeting minutes that are yet to come from the Federal Open Market Committee (FOMC).
It is because of these factors that investors are being very cautious about investing in the greenback.
China’s Economic Situation
China has recently shared its economic situation showing that its retail sales have recorded ease. The retail sales have reportedly moved down by 2.7% on a YoY scale, while the expectation was 5.0%.
The Industrial Production rate recorded in the month of July was 3.8%, which was a lower outcome than the expected rate.
Technical Analysis for USD/JPY
Coming back to the USD/JPY pair, there is a triangle that has been formed on the graph. It shows that on the upside, the pair is expected to hit 134.20 and on the downside, it is 132.35.
It is expected that the trading value of the pair may consolidate at 133.80.