USD/JPY is bullish and heading towards the 106.25 resistance level

The USD/JPY pair is trading at fresh three-week highs above the 106.00 threshold after US President Trump tweeted he supports measures to underpin the economy, boosting mood. The bullish breakout anticipates further gains ahead, Valeria Bednarik, Chief Analyst at FXStreet, reports.

Key quotes

“President Trump announced his support for the economy after earlier calling off negotiations with Democrats. Among other things, Trump mentioned checks to all Americans, aiding airlines and payroll protection.”

“Japan published the preliminary estimate for the August Leading Economic Index, which improved by less than anticipated, printing at 88.8 vs the 89.4 forecast. The Coincident index for the same period beat expectations, coming in at 79.4. The US won’t publish relevant data today, although the Federal Reserve will release the Minutes of its latest meeting.”

“The 4-hour chart shows that the USD/JPY pair has moved above all of its moving averages, with the 20 SMA slowly gaining bullish traction. Technical indicators in the mentioned time-frame head firmly higher within positive levels, supporting additional gains, mainly with a break above 106.25 the next relevant resistance.”