USD/JPY Breaks Key Hurdle, US GDP Grew 6.6%
- USD/JPY formed a support base above 109.00 and it started a fresh increase.
- It broke a major contracting triangle with resistance near 109.90 on the 4-hours chart.
- EUR/USD could attempt an upside break above 1.1800.
- The US GDP grew 6.6% in Q2 2021 (prelim), up from the last 6.5%.
USD/JPY Technical Analysis
The US Dollar formed a base above 109.00 against the Japanese Yen. USD/JPY started a fresh increase and it broke the key 110.00 resistance zone.
Looking at the 4-hours chart, the pair was able to gain strength above the 109.80 and 110.00 resistance levels. There was a break above the 50% Fib retracement level of the downward move from the 110.80 high to 109.08 swing low.
There was a break above a major contracting triangle with resistance near 109.90. The pair also settled above the 110.00, the 100 simple moving average (red, 4-hours) and the 200 simple moving average (green, 4-hours).
An immediate resistance is near the 110.40 level. It is near the 76.4% Fib retracement level of the downward move from the 110.80 high to 109.08 swing low.
The next major resistance is near the 110.80 zone. On the downside, an initial support is near the 109.90 zone. The main support is now forming near 109.60. A close below the 109.60 level might open the doors for more losses. The next major support is near the 109.00 level.
Fundamentally, the US GDP for Q2 2021 (prelim) was released yesterday by the US Bureau of Economic Analysis. The market was looking for a growth of 6.7%.
The actual result was below the market forecast, as the US GDP grew 6.6%, but it was better than the last rate of 6.5%.
Looking at EUR/USD, the pair broke the 1.1750 zone but it is still facing hurdle near 1.1800. Besides, GBP/USD is facing an uphill task near 1.3800.
- US Personal Income for July 2021 (MoM) - Forecast +0.5%, versus +1.0% previous.
- Fed's Chair Powell speech.