USD/JPY – Steady Ahead of Jobless Claims

USD/JPY is almost unchanged on Thursday, as the pair trades just under the psychologically important 120 level. The yen continues to struggle, as the currency finds itself at seven-year lows. On the release front, the major event of the day is Unemployment Claims, with the markets expecting a improvement from the previous reading. We’ll get a look at additional job data on Friday, with the release of Nonfarm Payrolls. There are no Japanese releases on Thursday.

The Japanese yen continues its disappearing act, as USD/JPY is knocking on the door of the 120 level, which hasn’t been breached since July 2007. On Monday, the Moody’s rating agency downgraded Japan’s debt from Aa3 to A1, citing “heightened uncertainty” over the ability of the government to reduce the debt. The downgrade is seen as a response to Prime Minister Abe’s decision to delay a sales tax hike and the negative GDP reading, which means that the country is officially in a recession.

US jobless claims did not impress on Wednesday, as ADP Nonfarm Employment Change fell to 208 thousand, down from 230 thousand in the previous release. This was well short of the estimate of 223 thousand. We’ll get a look at the official Nonfarm Employment Change report on Friday, with the markets expecting a strong reading of 231 thousand. Will the indicator meet or beat expectations?

USD/JPY for Thursday, December 4, 2014

USD/JPY December 4 at 12:00 GMT

USD/JPY 119.92 H: 119.98 L: 119.75

USD/JPY Technical

• USD/JPY has been flat in the Asian and European sessions.
• 118.89 is a strong support level.
• On the upside, 119.93 was tested earlier and remains fluid. Will the pair break through and push past the 120 level?
• Current range: 118.89 to 119.93

Further levels in both directions:

• Below: 118.89, 117.94, 116.66, 115.75 and 114.65
• Above: 119.83, 120.63, 121.39 and 122.18

OANDA’s Open Positions Ratio

USD/JPY ratio is showing little change on Thursday. This is consistent with the lack of movement we’re seeing from the pair. The ratio is evenly split between a long and short positions, indicative of a lack of trader bias as to what direction the pair will take.

USD/JPY Fundamentals

• 00:30 US FOMC Member Richard Fisher Speaks.
• 12:30 US Challenger Job Cuts.
• 13:30 US Unemployment Claims. Estimate 296K.
• 13:30 US FOMC Member Loretta Mester Speaks.
• 15:30 US Natural Gas Storage. Estimate -51B.
• 17:30 US FOMC Member Lael Brainard Speaks.

*Key releases are highlighted in bold

*All release times are GMT

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