USD/JPY catches fresh bid, eyes post-NFP highs

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

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

    Oct 7, 2015
    Likes Received:
    Fresh bids emerged for the USD/JPY pair near daily S1 at 116.86, providing fresh impetus to at the beginning of this week and now pushed the major further beyond 117 handle.

    USD/JPY eyes post-NFP highs

    The major appears to regain lost momentum and makes another recovery attempt towards post-NFP highs at 117.40, having consolidated around 117 handle on Friday’s overnight. At the time of writing, the major trades 0.31% higher at fresh session highs of 117.25.

    The bulls continue to cheer Friday’s auspicious labour market report from the US, which is likely to keep the Fed four rate hike prospects for this year intact. The US jobless rate fell to 4.9% in January, marking the lowest level since February 2008. While the average hourly earnings rose 0.5% in January, notably steeper than the 0.3% increase forecasted.

    Meanwhile, as China’s markets remain close until next Monday on New Year holiday, thin trades and limited volatility is expected to persist during the Asian trades. While markets seem to ignore the latest initiative taken by the BOJ, the January meeting ‘Summary of Opinions,’ and also the slight weakness seen on the Asian equities.

    Nothing of note for the major in the day ahead, except for the US labour market conditions index.

    USD/JPY Technical levels to watch

    In terms of technicals, the immediate resistance is located at 117.40 (post-NFP high). A break above the last, the major could test 117.83/118 (Jan 21 High/ round number). While to the downside, the immediate support is seen at 116.86/83 (Daily pivot & low) and below that at 116.38/116 (post-NFP low/ psychological levels).
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