USD/JPY analysis: waiting for BOJ Minutes and US Nonfarm Payroll report
|USD/JPY Current price: 111.63
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USD/JPY stuck in range ahead of US employment data, BOJ's Meeting Minutes.
- Former 111.40 resistance now the support to break to confirm another leg lower.
The USD/JPY pair fell this Thursday to a daily low of 111.31, but saw little intraday activity, settling at the end of the day at around 111.60. The yen appreciated just modestly against its American rival in a risk-averse environment, due to the clear imbalance between both central banks, highlighted by results of the meetings that took place this week. At the beginning of the day, the Bank of Japan unexpectedly offered to buy 400 billion yen of5-to-10 year bonds, to counter rising yields after the 10-year yield touch an 18-month high of 0.145%. US yields, on the other hand, were little changed this Thursday, with the yield on the benchmark 10-year Treasury note settling at 2.98% after touching 3.01%. The BOJ will release the Minutes of its latest meeting during the upcoming Asian session, followed by the release of the July Markit Services PMI expected at 51.6 from the previous 51.4. The pair is hovering around the 38.2% retracement of its latest daily slump with no clear directional strength according to technical readings in the 4 hours chart, as the price is stuck between the 100 and 200 SMA, while the Momentum heads lower but the RSI north, not far from their midlines. The pair found support in a former resistance, the 111.40 region, the level to break to confirm a new leg lower for this Friday, although direction, in this case, will depend on the outcome of the US Nonfarm Payroll report.
Support levels: 111.40 111.00 110.65
Resistance levels: 111.75 112.20 112.60
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