USD/JPY – Struggling Yen Tests 119

USD/JPY is slightly lower on Monday, as the pair trades in the mid-118 range. The yen continues to lose ground, as the pair briefly pushed above the 119 line for the first time in over seven years. On the release front, it’s a quiet start to the week. In Japan, the sole event of the day, Japanese Final Manufacturing PMI, met expectations. Today’s highlight is ISM Manufacturing PMI. The markets are expecting a softer reading, with an estimate of 57.9 points.

The Japanese yen continues to trade at low levels, and BoJ Governor Haruhiko Kuroda addressed this issue last week, noting that the soft yen was having a negative effect on the Japanese economy. However, with the economy officially in recession and the BOJ easing in October, the yen remains under strong pressure and could be headed to the 120 level.

Ahead of the Thanksgiving holiday, the US released a batch of data on Wednesday and the numbers left little to cheer about. Unemployment Claims jumped to 313 thousand, its highest level since mid-September. Core Durable Goods Orders declined 0.9%, its third decline in four readings. The estimate stood at 0.5%. New Home Sales fell to a 3-month low, dropping to 458 thousand. This was short of the estimate of 471 thousand. Pending Home Sales was no better, declining by 1.1%, well off the estimate of 0.9%. There was better news from UoM Consumer Sentiment, which posted a fourth straight gain, rising to 88.8 points. However, this was short of the estimate of 90.2 points. Despite the weak numbers, market sentiment towards the US economy remains high.

USD/JPY for Monday, December 1, 2014

USD/JPY December 1 at 13:55 GMT

USD/JPY 118.30 H: 119.07 L: 118.14

 

USD/JPY Technical

S3 S2 S1 R1 R2 R3
115.75 116.66 117.94 118.89 119.93 120.63

 

  • USD/JPY posted losses late in the Asian session. The pair is almost unchanged in European trade.
  • 118.89 is an immediate resistance line. 119.93 is next.
  • 117.94 is providing weak support. 116.66 is stronger.
  • Current range: 117.94 to 118.89

Further levels in both directions:

  • Below: 117.94, 116.66, 115.75, 114.65 and 113.68
  • Above: 118.89, 119.83, 120.63 and 121.39

 

OANDA’s Open Positions Ratio

USD/JPY ratio is pointing to gains in short positions on Monday. This is consistent with the pair’s movement, as the pair has posted losses. The ratio has a majority of long positions, indicative of trader bias towards the dollar moving to higher ground.

USD/JPY Fundamentals

  • 1:35 Japanese Final Manufacturing PMI. Estimate 52.1 points. Actual 52.0 points.
  • 14:45 US Final Manufacturing PMI. Estimate 55.0 points.
  • 15:00 US ISM Manufacturing PMI. Estimate 57.9 points.
  • 15:00 US Manufacturing Prices. Estimate 52.6 points.
  • 17:15 US FOMC Member William Dudley Speaks.
  • 18:00 US FOMC Member Stanley Fischer Speaks.
  • 23:50 Japanese Monetary Base. Estimate 37.2%.

*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.