- The US Dollar gained traction to trade above the 104.00 resistance area against the Japanese yen.
- There is currently a contracting triangle pattern formed on the hourly chart of USDJPY, which can ignite the next move soon.
- The Japanese Industrial Production was released by the Ministry of Economy, Trade and Industry today.
- The outcome was mixed, as there was a rise of 1.3% in August 2016, but less than the last increase of 1.5%.
USDJPY Technical Analysis
The US dollar traded above the 104.00 resistance area against the Japanese yen and also closed above the 21 hourly simple moving average. Currently, there is a contracting triangle pattern formed on the hourly chart of USDJPY.
The highlighted pattern may play a major role for the pair in the next move. The chances of a break higher are more since the market sentiment is favoring the greenback.
As long as the pair is above the 21 hourly simple moving average, the USD bulls may remain in action.
Japanese Industrial Production
Today, the Japanese Industrial Production, which measures outputs of the Japanese factories and mines was released by the Ministry of Economy, Trade and Industry.
The market was expecting a rise of more than 1% in August 2016, compared with the previous month. The result was in line with the forecast, as there was an increase of 1.3%, but it was less than the last rise of 1.5%. When we look at the yearly change, there was a rise of 4.5% in August 2016, compared with the same month a year ago. It was again lower compared with the last reading of 4.6%.
Overall, the Japanese yen buyers have hardly any reason to take it higher, which may prompt more gains in the USDJPY pair in the short term.