Trump comments hurt the greenback

Yesterday in an interview with CNBC President Donald Trump said a strong USD puts the United States in a difficult situation. The comment could be connected to fears of future declined exports. Trump also criticized the Fed for raising interest rates but also added that he does not interfere with the Fed’s work. Though, he made it clear through his comments that he is not thrilled with fact that the Fed brings the economy back down with rate hikes. The greenback immediately reacted and dropped against its major counterparts the EUR and JPY. Moreover, the White House confirmed Thursday that President Trump has invited Russian President Putin to Washington this autumn. Donald Trump even though under huge criticism on the matter and specifically from the US , stated earlier this week that the first meeting was a success and similar feedback was given from President Putin. The new invitation could indicate further developments on the relationships of the two countries and even business partnership.

USD/JPY dropped on the release of the comments and remained between our 112.75 resistance level and the 112.05 Support barrier. From a technical perspective, it must be noted that the RSI indicator on the 4 hour chart is very near the reading of 50 which could imply uncertainty among traders for the day and that a sideways movement between the pre mentioned levels could continue. Should the bulls take over the market we could see the pair breaking the 112.75 resistance line continuing higher aiming for the 113.65 resistance level. Should the bears dominate the pairs direction we could see it breaking the 112.05 support line and aim for the 111.30 support barrier.