FX.co ★ Global macro overview for 30/06/2016

Global macro overview for 30/06/2016:

The Industrial Production data from Japan were released overnight, and they disappointed the market participants. Industrial production declined for a sixth consecutive month in May, as factories were stymied by weak international demand and the aftershocks of recent earthquakes near the country's manufacturing centre. The Ministry of Economy, Trade and Industry revealed that industrial output fell 0.1% in the 12 months through May following a 3.3% year-over-year decline in the previous month. Compared to April, industrial production declined 2.3% after rising 0.5% in the previous month. Economists forecast a monthly drop of only 0.1%. Moreover, private research firms Markit/Nikkei showed last week that the manufacturing sector declined for a fourth consecutive month in June as the manufacturing PMI slid to 47.7 points. In conclusion, another challenge in the form of industrial production must be overcome by the Japanese economy in order to get back on its feet again. Japanese Prime Minister Shinzo Abe has promised new rounds of stimulus this autumn, but after the recent economic data the help might come much sooner than that.

Let's now take a look at the USD/JPY technical picture on the daily time frame. The big down candle after the UK's referendum results is now the main point of reference for bears as they are in control over this market. The price is trading below 55, 100, and 200 DMA, which supports the bearish view. The next support is seen at the level of 99.01, and the next resistnace is seen at the level of 103.52.