USD/JPY – Dollar punches past 110 as sharp NFP weighs on yen

USD/JPY has posted considerable gains in the Monday session, continuing the upward trend seen on Friday. In North American trade, the pair is trading at 109.95, up 0.41% on the day. It’s a quiet day on the release front, with no major indicators. On Tuesday, the key event is ISM Non-manufacturing PMI.

Japanese manufacturing PMI slipped to 50.3 in January, down from 52.6 points a month earlier. This was the weakest score since August 2016 and points to stagnation in the manufacturing sector. The ongoing global trade war has taken a toll on Japanese exports, which is turn has dampened the manufacturing industry. The U.S-China trade spat has been the catalyst behind the global trade war, and investors are cautiously optimistic that negotiations between the sides will continue and that a threat by the U.S. to impose further sanctions on March 1 will be avoided.

In the U.S., the week ended with mixed employment numbers. The economy created 304 thousand jobs, crushing the estimate of 165 thousand. This was the second score above the 300-thousand mark for a second successive month. However, wage growth was a disappointment, dropping from 0.4% to 0.1%. This fell shy of the estimate of 0.3% and marked the weakest reading since April 2018.

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USD/JPY Fundamentals

Sunday (February 3)

  • 18:50 Japanese Monetary Base. Estimate 4.6%. Actual 4.7%

Monday (February 4)

  • 15:00 US Factory Orders. Estimate 0.3%.
  • Tentative – US Loan Officer Survey

Tuesday (February 5)

  • 15:00 US ISM Non-Manufacturing PMI. Estimate 57.0

*All release times are EST

*Key events are in bold

USD/JPY for Monday, February 4, 2019

USD/JPY February 4 at 9:00 EST

Open: 109.51 High: 109.96 Low: 109.43 Close: 110.05

USD/JPY Technical

S3 S2 S1 R1 R2 R3
107.36 108.11 109.37 110.28 110.90 112.16

USD/JPY posted small gains in the Asian and European sessions. This trend has continued in the North American session

  • 109.37 is providing support
  • 110.28 is the next resistance line
  • Current range: 109.37 to 110.28

Further levels in both directions:

  • Below: 109.37, 108.11, 107.36 and 106.62
  • Above: 110.28, 110.90 and 112.16

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

Market Analyst at OANDA
A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in several major online financial publications including, Seeking Alpha and FXStreet. Based in Israel, Kenny has been a MarketPulse contributor since 2012.
Kenny Fisher

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