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US dollar fails to sustain NFP-inspired gains, USD/JPY retreats

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Jan 8, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
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    FXStreet (Córdoba) - The spike of the dollar that followed a strong employment reading, turned out to be short-lived, with USD/JPY hitting fresh highs only to fall back below 118.00 afterward.

    USD/JPY reacted positively and hit a daily peak of 118.82 but quickly turned lower, retracing most of its intraday advance. At time of writing, the pair is trading at 117.75, just a few pips above its opening price.

    The yen weakened during the Asian session as risk aversion eased following a positive performance of the Chinese equity markets and a stabilization of the yuan. However, the dollar failed to hold gains despite the upbeat US nonfarm payrolls report.

    On the data front, US economy added 292,000 jobs in December, beating the 200,000 expected while November and October readings were upwardly revised by a combined 50,000. The unemployment rate stood unchanged at 5.0% as expected.

    USD/JPY levels to watch

    At time of writing, the pair is trading at 118.65, up 0.85% on the day. On the upside, immediate resistances are seen at 119.15 (Jan 6 high) and 119.47 (10-day SMA). On the downside, supports could be found at 117.32 (Jan 7 low), 117.00 (psychological level) and 116.16 (Aug 24 low).
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