Current trend

The USD/JPY pair is showing mixed trading, holding close to 147.00. The day before, the instrument demonstrated another attempt at growth, reacting to the publication of statistics in the United States, but this time it failed to update record highs. The Consumer Price Index in August accelerated from 3.2% to 3.7% in annual terms, which was higher than expectations at 3.6%, and in monthly terms the inflation rate increased from 0.2% to 0.6%, which coincided with forecasts. At the same time, the Core CPI slowed from 4.7% to 4.3%, which reflects the significant contribution of rising energy prices to the overall dynamics of American inflation.

In turn, pressure on the yen is exerted by data from Japan. Industrial Production volumes at the end of July decreased by 1.8% after -2.0% a month earlier, and in annual terms the indicator lost 2.3% after -2.5% in June. Machinery Orders in annual terms decreased by 13.0% after -5.8%, while analysts expected -10.7%, and in monthly terms the indicator fell by 1.1% after an increase of 2.7% with preliminary estimates at -0.9%.

Meanwhile, the Governor of the Bank of Japan, Kazuo Ueda, said that the regulator may abandon the policy of negative interest rates when statistics confirm that inflation is approaching the target level of 2.0%. A decision could be made as early as the end of this year.

The focus of investors today will be on August statistics from the United States on Retail Sales volumes, as well as on Producer Price Indices.

Support and resistance

In the D1 chart, Bollinger Bands are reversing horizontally. The price range is almost unchanged, but it remains rather spacious for the current level of activity in the market. MACD is falling, keeping a relatively strong sell signal (the histogram is below the signal line). Stochastic is reversing into an upward plane after a short decline, again approaching its highs, indicating that the US dollar is overbought in the ultra-short term.

Resistance levels: 147.36, 148.00, 149.00, 150.00.

Support levels: 146.62, 146.00, 145.00, 144.00.

Trading tips

Short positions may be opened after a breakdown of 146.62 with the target at 145.00. Stop-loss — 147.36. Implementation time: 2-3 days.

A rebound from 146.62 as from support followed by a breakout of 147.36 may become a signal for opening new long positions with the target at 149.00. Stop-loss — 146.62.