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USD/JPY -Struggling Yen Flirting With 119

USD/JPY has posted small gains on Monday, as the pair trades slightly under the 119 line in the North American session. On the release front, today’s highlight is Japanese Current Account. In the US, the only data release is the Labor Conditions Market Index. As well, FOMC member Dennis Lockhart will deliver a speech in Atlanta.

US releases wrapped up the week in fine fashion, as employment data shined. Nonfarm Employment Change, one of the most important indicators, posted a gain of 252 thousand, easily beating the estimate of 241 thousand. The unemployment rate fell to 5.6%, edging below the forecast of 5.7%. Meanwhile, Average Earnings dropped 0.2%, its first decline since July 2013. A lack of wage pressure means that the Fed may be able to postpone a rate hike until the second half of 2015.

The Federal Reserve released the minutes of its previous meeting on Wednesday, with no surprises for the markets. There had been plenty of speculation that the insertion of the word “patience” in the previous policy statement signaled a more aggressive monetary stance. However, the minutes stated that Fed members remained of the view that Fed policy had not changed, and that a rate hike was unlikely before April. Although economic growth continues to improve, inflation remains at very low levels, which means that the economy is in no danger of overheating, so there is no immediate need for a rate increase.

USD/JPY for Monday, January 12, 2015

USD/JPY January 12 at 13:50 GMT

USD/JPY 118.86 H: 119.31 L: 118.10

 

USD/JPY Technical

S3 S2 S1 R1 R2 R3
116.69 117.94 118.69 119.83 120.63 121.39

 

Further levels in both directions:

 

OANDA’s Open Positions Ratio

USD/JPY ratio is pointing to gains in long positions on Monday. This is consistent with the pair’s movement, as the dollar has posted small gains. The ratio has a majority of long positions, indicative of trader bias towards the dollar continuing to move upwards.

USD/JPY Fundamentals

*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 [4]

Currency Analyst at Market Pulse [5]
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.