USD/JPY – Dollar Rally Continues, Breaks Past 116

The Japanese yen has lost ground on Friday, as USD/JPY trades in the mid-116 range in the European session. The struggling yen has lost over 200 points this week, as USD/JPY continues to move higher and finds itself at five-year highs. On the release front, it’s a busy day in the US, with three key events – Core Retail Sales, Retail Sales and UoM Consumer Sentiment. There are no Japanese releases on Friday.

US Unemployment Claims has looked solid in recent readings, but the key indicator jumped to 290 thousand, missing the estimate of 282 thousand. This marked a seven-week high for the key indicator. USD/JPY shrugged off the weak reading and continues to show little movement. On Friday, we’ll get a look at US retail and consumer confidence numbers, so we could see some movement from USD/JPY.

Japanese manufacturing data has looked sharp this week. Core Machinery Orders gained 2.7%, crushing the estimate of -1.0%. Revised Industrial Production posted a gain of 2.9%, bouncing back after a decline of -1.9%. The estimate stood at 2.7%. Earlier in the week, Tertiary Industry Activity gained 1.0%, its best showing since April.

USD/JPY for Friday, November 14, 2014

USD/JPY November 14 at 11:45 GMT

USD/JPY 116.48 H: 116.49 L: 115.74

 

USD/JPY Technical

S3 S2 S1 R1 R2 R3
113.68 114.65 115.75 116.66 117.94 118.89

 

  • USD/JPY tested support at 115.75 early in the Asian session but then posted gains. The upward trend continues in European trade.
  •  On the upside, 116.66 has weakened as the dollar continues to move higher. Will the pair break above this line? 117.94 is stronger.
  • 115.75 is providing support.
  • Current range: 115.75 to 116.66

Further levels in both directions:

  • Below: 115.75, 114.65, 113.68, 112.94 and 110.68
  • Above: 116.66, 117.94, 118.89 and 119.83

 

OANDA’s Open Positions Ratio

USD/JPY is pointing to gains in short positions on Friday. This is not consistent with the movement of USD/JPY, as the pair continues to post gains. The ratio is close to an event split between short and long positions, indicative of a lack of trader bias as to the direction to expect from the pair.

 

USD/JPY Fundamentals

  • 13:30 US Core Retail Sales. Estimate 0.2%.
  • 13:30 US Retail Sales. Estimate 0.2%.
  • 13:30 US Import Prices. Estimate -1.7%.
  • 14:55 US Preliminary UoM Consumer Sentiment. Estimate 87.3 points.
  • 14:55 US Preliminary UoM Inflation Expectations.
  • 15:00 US Business Inventories. Estimate 0.3%.
  • 15:00 US Mortgage Delinquencies.
  • 15:30 US Natural Gas Storage. Estimate 37B.
  • 21:00 US FOMC Member Stanley Fisher Speaks.

*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.