Fundamental view:

The unfavorable news of Japan House spending yearly report created a bullish move for the pair whereas US Crude Oil Inventories at 8^th July  and US Core PPI report at 10th July 2020 acted as a catalyst for the downtrend move for dollar and boosted bearish move for the pair. Overall Japan showed phases of economic recovery which was portrayed in many reports like PPI yearly report and Core machinery orders.

The increasing cases of corona virus blocks the way for economic recovery hopes in US making Yen stronger than dollar thus last week USD/JPY reflected a bearish trend.

The major economic events deciding the movement of the pair in the next week are JPY Revised Industrial Production monthly report at Jul 14, JPY Monetary Policy Statement, USD Treasury Currency Report at Jul 15, JPY National Core CPI yearly report, Unemployment Claims at Jul 16, and USD Prelim UoM Consumer Sentiment at Jul 17.

USD/JPY Weekly outlook:

Technical View:

Last week’s high was 0.36% lower than the previous week. Maintaining high at 107.78 and low at 106.64 showed a movement of 114 pips.

In the upcoming week we expect USD/JPY to show a bearish trend. The currency pair is trading below the 100 Simple Moving Average and the MACD trades to the Downside. A solid breakout below 106.43 may open a clean path towards 105.95 and may take a way down to 105.27. Should 107.58 prove to be unreliable resistance, the USDJPY may raise upwards 108.26 and 108.74 respectively. In H4 chart, Formation of rectangle breakout pattern indicates reversal of the trend creating prospects of a bearish trend.