FxWirePro: USD/JPY neutral in the near-term, scope for downward resumption

Tuesday, July 18, 2017 3:03 PM UTC

USD/JPY declined on Tuesday as the dollar was weighed down after the collapse of a key U.S. healthcare bill raised doubts about President Donald Trump's reform agenda.
Two Republicans said they would not back the latest Obamacare rollback bill, Senate Republican Leader Mitch McConnell was weighing a vote on simply repealing the 2010 healthcare law with no replacement.
Investors fretted about the growing division within U.S. President Donald Trump's Republican party that has hampered the administration's legislative policy goals. Tuesday’s economic data also weighed on sentiment.
U.S. import prices fell for a second straight month in June amid further declines in the cost of petroleum products, evidence of tepid inflation that could further reduce chances of another Federal Reserve interest rate hike in December.
Currently, the currency pair is trading at 111.80 levels, it is set to decline further towards 111.50 and later 111.20 levels in the short term.
To the upside, immediate resistance can be seen at 112.10, a break above this level would take the pair towards next resistance level at 112.48.
To the downside immediate support can be seen at 111.34, a break below this level will open the gates towards next level at 111.00.

Resistance Levels

R1: 112.10 (50% Retracement level)

R2: 112.48 (June 27th high)

R3: 112.98 (61.8% Retracement level)

Support Levels

S1: 111.34 (38.2% Retracement level)

S2: 111.00 (Psychological levels)

S3: 110.36 (23.6% Retracement level)

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