The US Dollar recovered some losses suffered during the European trading session following a stellar trading session yesterday. The impressive rise in the greenback during the Asian trading session was primarily driven by the surprise oil supply cut announcement by OPEC+, which sparked inflation concerns sending the USDJPY currency pair slightly and then correcting downwards as investors looked to the manufacturing activity data in the US.  

The soft US manufacturing activity for March weighed the greenback sending the currency broadly lower during Monday’s trading session. The ISM manufacturing PMI declined from 47.7 to 46.3, which was lower than the expected 47.5. With the lack of economic indicators from the Japanese economy, the USDJPY is slightly higher as the US greenback continues to trend slightly higher as investors look to correct some of the overreaction selloffs of the greenback during the European session.

Technical

The 4H chart shows that the price action of the currency pair is trading around the golden ratio at the 61.80% Fibonacci level as the bulls and bears continue to scuffle for outright supremacy. With the lack of major economic indicators from both economies, the markets might expect the currency pair to trade between the 133.014 and 132.217 range during the trading session.

Nevertheless, the bears could look for a breakthrough below 132.217 for confirmation of bearish momentum, with the next support level at 131.663 firmly in sight. The bulls could look to the breakout above to 133.847 resistance level, which would bring the 134.711 resistance level into play.

Summary

Even though lower-than-expected ISM manufacturing data weighed down the US dollar yesterday, the lack of economic data today could leave sentiment to drive the currency pair’s movement during the trading session today, with no major movement in either direction expected.

Sources: TradimgView, Reuters, CNBC.

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