The USD/JPY is settling following Friday’s impressive run on the heels of better than expected U.S. employment data. The data wire has been relatively quiet since then, allowing investors to lock in profits ahead of key release from China. China will print Trade Balance and New Loans data tomorrow followed by Industrial Production, CPI, and a host of 
other data due during Thursday’s Asia trading session. Japan will also release Core Machinery Orders tomorrow followed by Final GDP on Thursday. Hence, activity in the USD/JPY could pick up soon after this breather. It will be interesting to see if the currency pair can pick up where it left off on Friday or whether it decides to revert back to the pressures of its downtrend. Weaker than expected data from Japan could help lift the USD/JPY since investors may speculate that the BoJ will be more will to increase liquidity while the Fed stands still amid an improving U.S. economic landscape. On the other hand, weak Japanese economic data could keep the USD/JPY buoyed around its highly psychological 90 area. The 90 level has been a struggle for some time now and there’s little reason to believe this will end tomorrow.
Technically speaking, the USD/JPY still faces multiple downtrend lines along with the highly psychological level and previous March highs. In fact, the USD/JPY still has to deal with February highs should the currency pair experience another near-term topside breakout. Hence, the USD/JPY faces an uphill battle to the topside. As for the downside, the USD/JPY has multiple uptrend lines serving as technical cushions along with intraday and 3/5 lows.
Present Price: 89.79
Resistances: 89.81, 89.90, 90.98, 90.04, 90.11, 90.21
Supports: 89.73, 89.64, 89.56, 89.46, 89.39, 89.31
Psychological: 90, March highs
(click chart to enlarge)
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