USD/JPY extends losses to the 133.00 area amid a weaker dollar

US dollar loses momentum amid lower US yields.
After US Jobless Claims attention turns to Friday’s Non-farm payrolls.
USD/JPY fails again to break above 134.50 and drops sharply.

Matías Salord FXStreet

The USD/JPY dropped further after the beginning of the American session and printed a fresh daily low at 133.02. A weaker US dollar weighed on the pair.

US data on focus

Economic data released in the US on Thursday showed an increase in Continuing Jobless Claims to the highest level since March, while Initial Claims rose to 260K. The trade deficit narrowed to $99.5B in June, the lowest in five months.

On Friday, the US official employment report is due. Market consensus is for an increase in payrolls by 250K. “Data surprises have been strongly correlated with broad USD variation. An above-consensus print should leave a slightly firmer tone but would expect price action to be somewhat contained. EURUSD bias leans lower but should be contained above 1.01. USDJPY faces more topside extension risk on a break of 134.80/00,” explained analysts at TD Securities.

The dollar is falling modestly across the board on Thursday. The US 10-year yield stands at 2.67% and the 30-year at 2.96%. In Wall Street, the Dow Jones is falling by 0.27% and the Nasdaq 0.37%.

The combination of lower US yields and negative risk sentiment is favoring the yen. The Japanese currency is among the top performers. The USD/JPY is near the 133.00 zone and a break lower could open the doors to more losses, with the next support at 132.70 followed by 132.20. On the upside, above 134.50 the dollar should strengthen.

Technical levels

USD/JPY

Overview
Today last price	133.16
Today Daily Change	-0.69
Today Daily Change %	-0.52
Today daily open	133.85

Trends
Daily SMA20	136.27
Daily SMA50	134.6
Daily SMA100	130.41
Daily SMA200	122.55

Levels
Previous Daily High	134.55
Previous Daily Low	132.29
Previous Weekly High	137.46
Previous Weekly Low	132.5
Previous Monthly High	139.39
Previous Monthly Low	132.5
Daily Fibonacci 38.2%	133.69
Daily Fibonacci 61.8%	133.15
Daily Pivot Point S1	132.58
Daily Pivot Point S2	131.3
Daily Pivot Point S3	130.32
Daily Pivot Point R1	134.84
Daily Pivot Point R2	135.82
Daily Pivot Point R3	137.1

Author

Matías Salord

FXStreet

Matías started in financial markets in 2008, after graduating in Economics. He was trained in chart analysis and then became an educator. He also studied Journalism. He started writing analyses for specialized websites before joining FXStreet.

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