USD/JPY – Yen Edges Higher After Positive Japanese Data

The Japanese yen has reversed directions in Tuesday trading and posted modest gains against the US dollar. In the European section. USD/JPY is trading in the mid-102 range. Taking a look at economic news, Japanese Average Cash Earnings matched the estimate, while Monetary Base was up sharply. In the US, it’s a very light schedule, with no major releases.

In Japan, Average Cash Earnings posted a slight gain of 0.1% for the second straight month, matching the forecast. Monetary Base continues to post sharp increases, hitting 52.5% in November. This surpassed the estimate of 47.2%.

Meanwhile, Bank of Japan Governor Haruhiko Kuroda said on Monday that he remained committed to the BOJ’s inflation target of 2% within two years, even though inflation indicators point to much lower inflation. Kuroda also said that the Bank’s ultra-loose monetary policy would continue until the inflation target was met. However, with inflation nowhere near the 2% target, some policymakers don’t share Kuroda’s optimism that this ambitious goal will be achieved.

Over in the US, the markets will be keeping close tabs on this week’s US employment releases, as the Fed is likely to pull the taper trigger early in 2014 if employment numbers continue to improve. Unemployment Claims have looked sharp for the past two releases, and if the Non-Farm Payrolls and Unemployment Rate follow suit this week, the US dollar could gain ground against the major currencies, including the yen.

USD/JPY for Tuesday, December 3, 2013

USD/JPY December 3 at 12:30 GMT

USD/JPY 102.71 H: 103.38 L: 102.55

USD/JPY Technical

• USD/JPY has posted modest gains in Tuesday trading. The pair hit a high of 103.38 late in the Asian session, but has since retracted and dropped into 102 territory.
• The pair continues to face resistance at 103.30. This is followed by a resistance line at 104.17, which has remained intact since October 2008.
• 102.53 is providing support. This is a weak line which could be tested during the day. This line is followed by support at 101.19.
• Current range: 102.53 to 103.30

Further levels in both directions:

• Below: 102.53, 101.19, 100.00, 98.92 and 98.15
• Above: 103.30, 104.17, 105.70 and 107.27

OANDA’s Open Positions Ratio

USD/JPY ratio is pointing to gains in short positions in Tuesday trading. This movement is reflected in the pair’s current movement, as the yen has reversed directions and has posted gains against the dollar. The ratio remains close to an even split between long and short positions, reflecting a lack of trader bias as to which direction USD/JPY may take next.

The pair continues to trade at high levels, as USD/JPY tested the 103 line earlier on Tuesday. With no major events out of the US today, it could be a quiet North American session for the pair.

USD/JPY Fundamentals

• 1:30 Japanese Average Cash Earnings. Estimate 0.1%. Actual 0.1%.
• 15:00 US IBD/TIPP Economic Optimism. Estimate 43.2 points.
• All Day – US Total Vehicle Sales. Estimate 15.8M.

*Key releases are highlighted in bold

*All release times are GMT

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