FxWirePro: USD/JPY Daily Outlook

USD/JPY chart - Trading View 

USD/JPY retraces from session lows at 110.12, trades at 110.33 at 04:00 GMT.

Dovish remarks from the BOJ policymakers and disappointing Japanese manufacturing PMI weigh on the Japanese yen.

Japan Nikkei flash manufacturing PMI for May 2019 decreased to 49.6 from previous 50.2.

Dep Gov Masayoshi Amamiya said BoJ to heed market impact and adjust interest rates when exiting the ultra-easy monetary policy.

US Markit manufacturing and services purchasing manager index (PMI) for May and new home sales in focus for further direction.

Manufacturing PMI is expected to slip from 52.6 to 52.5, while, services PMI may improve to 53.2 versus 53.0 prior. 

Further, new home sales is likely to dip to 0.675 million marks compared to 0.692 million prior.

We see scope for upside on the intraday charts, but major trend remains bearish.

Price action is holding support at 4H 55-EMA and has bounced off 1H 100-SMA with a dragonfly doji formation.

Stiff resistance is seen at 110.44 (converged 20-DMA and 21-EMA), break above could see further upside.

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