USD/JPY retains its bearish stance despite a modest bounce from weekly lows

USD/JPY is consolidating weekly losses, trading around 104.60, as the dollar is down across the board amid a better market mood and upbeat data elsewhere, FXStreet’s Chief Analyst Valeria Bednarik reports.

Key quotes

“Japanese data was generally encouraging, as the National CPI ex-Fresh Food declined by 0.3% YoY, better than the expected -0.4%. Also, the preliminary estimate of the Jibun Bank Manufacturing PMI for October came in at 48, improving from 47.7. The US session will bring the preliminary estimates of the October Markit PMIs. Services output is foreseen steady at 54.6 while manufacturing activity is seen expanding from 53.2 to 53.4.”

“USD/JPY is technically bearish in the near-term. The 4-hour chart shows that the pair continues developing below a firmly bearish 20 SMA, which remains below the larger ones. Technical indicators in the meantime, continue to consolidate near oversold readings.” 

“The slump will likely accelerate once below 104.30, the immediate support level.”