USD/JPY – Dollar Firm Ahead of Unemployment Claims

USD/JPY remains at high levels as the pair trades just shy of the 104 line on Thursday. On the release front, there are three key events on the schedule – Unemployment Claims, Trade Balance and the ISM Non-manufacturing PMI. There are no Japanese releases on Thursday.

US employment releases started the week on the right foot, as, ADP Nonfarm Payrolls continues to climb. The key indicator jumped to 191 thousand in February, up from 139 thousand a month earlier. This practically matched the estimate of 192 thousand. The markets will get a good look at the US employment picture, with Unemployment Claims on Thursday, and the Unemployment Rate and NFP wrapping things up on Friday.

Japanese Tankan indexes are important indices which provide a glimpse of the health of the Japanese economy. The releases were a mix in Q1, and the yen did not show much reaction. The Manufacturing Index rose slightly to 17 points, falling short of the estimate of 19 points. However, the Non-Manufacturing Index showed a significant upturn, jumping to 24 points from 20 points, matching the forecast. On Monday, Preliminary Industrial Production starting off the week with a whimper, declining 2.3% in February, an eight-month low.

Earlier in the week, Fed chair Janet Yellen said that inflation and employment levels needed to improve considerably, and the Federal Reserve would continue to provide monetary stimulus for some time. Currently, the Fed is purchasing $55 billion in assets under its QE scheme. There have been three tapers to QE so far, and Yellen plans to wind up the program in the fall, provided that the US economy does not run into any serious turbulence. At the same time, the Federal Reserve has stated that it has no plans to raise interest rates until sometime in 2015.

 

USD/JPY for Thursday, April 3, 2014

Forex Rate Graph 21/1/13

USD/JPY April 3 at 12:25 GMT

USD/JPY 103.92 H: 104.07 L: 102.81

 

USD/JPY Technical

S3 S2 S1 R1 R2 R3
101.19 102.53 103.30 104.17 105.70 106.85

 

  • USD/JPY is showing little movement on Thursday. The pair briefly punched across the 104 line in the Asian session.
  • 104.17 is providing weak resistance. This is followed by 105.70, which has not been tested since October 2008.
  • On the downside, 103.30 is providing support. The next support line is 102.53.
  • Current range: 103.30 to 104.17

Further levels in both directions:

  • Below: 103.30, 102.53, 101.19, 100.00 and 99.57
  • Above: 104.17, 105.70, 106.85 and 107.80.

 

OANDA’s Open Positions Ratio

USD/JPY ratio is almost unchanged in Thursday. This is consistent with the pair’s movement, as the yen is showing little movement. The ratio is now close to evenly split, indicating a lack of trader bias as to what direction the pair will take.

USD/JPY remains at high levels and is closing in on the 104 line. We could see some movement from the pair in the North American session, as the US releases Unemployment Claims.

 

USD/JPY Fundamentals

  • 12:30 US Trade Balance. Estimate -38.3B.
  • 12:30 US Unemployment Claims. Estimate 319K.
  • 13:45 US Final Services PMI. Estimate 55.5 points.
  • 14:00 US ISM Non-Manufacturing PMI. Estimate 53.5 points.
  • 14:30 US Natural Gas Storage. Estimate -74B.

*Key releases are highlighted in bold

*All release times are GMT

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.