The USD/JPY has managed to bottom out above 11/11 lows and our 2nd tier uptrend line despite a pullback during the Asia trading session. The USD/JPY's behavior has been erratic lately as investors debate how to deal with the currency pair's highly psychological 90 level. Therefore, the USD/JPY has been a tough read the last week as far as correlations are concerned. However, a near-term pattern could development at the beginning of next week with the release of Japan's Prelim GDP data along with U.S. Retail Sales. Stronger than expected GDP data combined with weak Retail Sales could lead investors to prefer the Yen over the Dollar, thereby weakening the USD/JPY. Such an occurrence isn't out of the question considering China's Retail Sales and Industrial Production data outperformed earlier this week while America's UoM Consumer Sentiment number disappointed today. We've witnessed an increase of import demand from China, and Japan likely benefitted from this development considering China is its largest trading partner. However, we will have to see how the data pans out before proceeded with more in-depth fundamental analysis.
Meanwhile, the USD/JPY still has our 1st and 2nd tier uptrend lines serving as technical supports along with 11/11, 11/02, and 10/14 lows. Therefore, the USD/JPY has quite a few technical cushions in place should conditions deteriorate. As for the topside, the USD/JPY is still mired in its long-term downtrend and faces multiple downtrend lines along with 11/12 and 11/06 highs. Furthermore, the psychological 90 level serves as both a technical cushion and barrier. Therefore, the USD/JPY may need a sizable jolt to proceed in a more definite direction.
Present Price: 89.68
Resistances: 89.77, 89.92, 90.04, 90.19, 90.31, 90.43, 90.58, 90.72
Supports: 89.54, 89.43, 89.26, 89.15, 88.99, 88.85
Psychological: 90, November and October Lows