FX.co ★ Technical analysis and trading recommendation for USDX and USD/JPY for April 24, 2015

In April, weak data on PMI indicated slower growth momentum for the US manufacturing sector, with production volumes and new jobs both expanding at weaker rates compared to the previous month. This contributed to a fall in the headline seasonally adjusted Markit Flash US Manufacturing Purchasing Managers' Index (PMI) to 54.2 in April from 55.7 in March.

In the week ending April 18, advanced figures for seasonally adjusted initial claims was 295,000, showing an increase of 1,000 from the previous week's unrevised level of 294,000.

The soft US data pushed the greenback to retest the 50Dsma. This is the fourth time when the USDX puts support at 50Dsma to the test. The USDX has been consolidating at 20Dsma finally ended with negative bias. The index is likely to make a double top between 98.46 and 98.43. Support is found at 97.00. Today's trading range is seen between 97.00 and 97.90.

USD/JPY

The US dollar is trading at 119.50 at Wednesday's Asian session compared to 119.58 at the end of the day. The pair erased its early gains and closed below 20&50dsma. Today, the pair faced strong resistance at 20Dsma 119.70 at the Asian session. The double bottom was formed between 118.33 and 118.54. The nearest support is seen at 119.30 100Dsma.We still recommend buying on dips. In the four-hour chart 200Dsma 120.10 has been acting as strong resistance. Hourly support is found at 119.30. Trade: Buying with sl 119.30 cmp 119.50 with a target at 119.70 or buy above 119.70 with targets at 120.00 and 120.10. In case of negative economic data from the US, sell below 119.30 with targets at 119.00 and 118.50. Those who wish to buy on dip can buy between 118.55 and 118.40 with sl 118.00. This view applies to positional traders.