Japanese Yen holds as soft US data meets a weak Yen
USD/JPY is holding near 159.40 at the time of writing, with little change on the day. A weak United States (US) Consumer Sentiment reading nudged the Dollar lower, but the pair has stayed close to where it started.
At the time of writing, the USD/JPY exchange rate remained steady around 159.40, with minimal fluctuation throughout the day. A disappointing US Consumer Sentiment reading contributed to a decline in the Dollar, but the currency pair has maintained its proximity to the starting point. The University of Michigan's preliminary Consumer Sentiment Index fell to 51 in August, down from 55.2, which was significantly below the anticipated 54.5.
The Expectations component also dropped to 50.6. This series of weak US data, combined with cooler inflation and a deteriorating Retail Sales report, has weakened the US Dollar (USD) and caused the Dollar Index (DXY) to decline on the same day. A weaker Dollar typically puts downward pressure on the USD/JPY, but the impact has diminished following the record joint US-Japan intervention in late July and early August, and there has been no further support from Tokyo.
Consequently, speculators have reverted to selling the Japanese Yen (JPY), resulting in a stalemate between a soft Dollar and a soft Yen. On the 4-hour chart, USD/JPY traded at 159.38, staying near a neutral near-term trend by staying above the 20-period simple moving average (SMA) at 159.33 while remaining below the 100-period SMA at 160.20.
The pair was situated just below the nearby horizontal barrier at 159.39, and the Relative Strength Index (14) of 56 indicated mild positive momentum without becoming overbought. Immediate resistance lay at 159.39, followed by the higher horizontal level at 159.58, with the more significant 100-period SMA at 160.20 as an upper cap.
On the downside, support was concentrated around the 20-period SMA at 159.33, preceding the horizontal floors at 159.20 and 159.10, which together created a shallow demand band that protected the recent consolidation area. Agustin Wazne, a Junior News Editor at FXStreet, covered the commodities and Majors market segments.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — it may contain errors, so check the original before relying on it.
