The USD/JPY is drifting lower today following stronger than expected Prelim GDP data from Japan. Furthermore, although the headline U.S. Retail Sales data topped expected, the Core number underperformed. Altogether, this could be a negative catalyst for the USD/JPY. The outperformance of Japan's GDP could lead investors to favor the Yen over the Dollar considering America's data continues to roll in negatively mixed. Furthermore, the positive headline Retail Sales figure could bode well for Japanese automakers, thereby benefiting Japan's economy and consequently the Yen. However, the S&P futures are currently climbing past previous 2009 highs as investors take the mixed U.S. data in stride. Therefore, it will be interesting to see how the USD/JPY reacts to both positive Japanese data along with a bullish technical move in U.S. equities. There's a possibility the two developments could counterbalance one another and leave the USD/JPY around its highly psychological 90 level for the time being. However, we'll just have to wait and see how the session pans out.
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: 89.47
Resistances: 89.54, 89.68, 89.83, 89.98, 90.07, 90.20, 90.39
Supports: 89.41, 89.26, 89.15, 88.99, 88.85, 88.73, 88.58
Psychological: 90, November and October Lows