USD/JPY broke out of the key resistance level of 111.0 on Monday after Japanese Prime Minister Abe said that he would delay a sales tax hike by another two and half years.

This comes on the back of weak Japanese retail trade data which signals stagnant consumer spending. The government probably wants to avoid delivering a hammer blow to a fragile economy without seeing solid improvement at the fundamental level.

USD/JPY climbed to 111.35 before coming down to 110.90 this morning. The immediate support and resistance levels now become 112.00 and 110.45 respectively.

AUD/USD has been consolidating near the three-month low of the 0.710-0.720 area. The MACD is about to form a positive crossover and 29% RSI shows oversold. The rest of the FX market was relatively quiet with the US and UK markets closed for bank holidays on Monday.

Asian markets closed positively on Monday, led by Japan. The Nikkei 225 index rose 1.39% on a weaker yen as Prime Minister Abe decided to postpone any sales tax hike. The Shanghai Composite, however, closed flat as the market continued to consolidate around the 2,800 level, with shrinking volume.

Singapore’s STI closed marginally lower. The share price of Noble Group tumbled 8.2% during the last few trading hours after the announcement of its CEO’s resignation. Genting Singapore, on the other hand, rose another 3.4% following Friday’s gain of 3.5%.

The WTI Crude oil price was little moved at $49.50 this morning. A few technical indicators have shown a strong resistance level found near to the $50.00 area as discussed earlier. The strong USD continued to suppress the gold and silver prices. Gold has tumbled to $1,203, its lowest level in more than three months. The Immediate support level is $1,200. Silver has dropped to the $16.00 area. Its next support level could be found near $15.63.


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