USD/JPY idles in the 108 territory as markets weigh the underlying funda


  • USD/JPY meets resistance in the open this week as traders weigh the underlying of the US economy.
  • Weekly support is in focus within the heavily bid environment. 

 After the heavy bid in the greenback at the end of the week's sessions following Federal reserve's Chair Jerome Powell’s comments, the yen is showing some resilience as the mighty dollar gives back a little breathing room to G10-FX to start the week.

At the time of writing, USD/JPY is trading at 108.40 and better bid from the opening price down at 108.26. The price met a nine-month high after the US nonfarm Payrolls payrolls data on Friday, but the market is weighing whether the reality of the situation doesn't contradict the hype. 

US February nonfarm payrolls trounced expectations and January’s data were revised up, but the underlying fact remains that there are still millions of the population permanently out of work. 

As lockdowns ease, people fortunate enough to be able to return to their jobs will do so, but many still do not have a job to go back to. A spike in jobs, in the interim, should be expected, but the forward outlook is so much more dubious.

As noted by analysts at ANZ Bank noted, ''most of the job gains came in leisure and hospitality (particularly food services and drinking places) as the COVID infection rate receded,'' given the easing lockdown measures. However, the trade deficit paints a bearish backdrop to the data. 

Meanwhile, over the weekend, US President Joe Biden’s $1.9trn stimulus passed the Senate 50-49 and it will go to the House on Tuesday. Overall, the stimulus is twice the size of Obama’s 2008-09 package and the US stock markets will likely find comfort in the balancing act between this and the threat of higher borrowing costs. 

USD/JPY technical analysis

as it stands, the price is meeting 4-hour resistance and the daily weekly territory is compelling. 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Get Weekly Crypto trade ideas!  
Empower yourself with the best market insights

Join FXStreet Premium!    

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD attempts recovery above 1.1950 as US dollar bounce fizzles

EUR/USD is attempting a recovery above 1.1950 ahead of the European open, as the US dollar’s rebound falters amid persistent weakness in the Treasury yields. Easing concerns over EU's covid vaccines rollout and dovish Fed expectations underpin the spot.

EUR/USD News

GBP/USD recovers to 1.3850 as UK’s optimism offsets USD bounce

GBP/USD recovers to 1.3850, picking up fresh bids heading into the London open. The cheers the UK’s advantage of faster vaccinations and unlock guidelines to shrug off the US dollar’s bounce off late the lowest since late March.

GBP/USD News

Gold’s path of least resistance appears north, $1798 in sight

Gold is consolidating last week’s rally to two-month highs of $1784, in the wake of the persistent weakness in the US Treasury yields across the curve.  However, gold bulls remain motivated, as China steps up bullion imports.

Gold News

Bitcoin network hash rate drop may not have caused BTC price crash

China’s prominent regions for Bitcoin mining have suffered an electrical grid blackout, causing Bitcoin’s hash rate to decline. Bitcoin price crashed over the weekend, coinciding with the drop of the network’s hash rate.

Read more

S&P 500 Week Ahead: Banks beat the street, COIN booms as funds flow to ETFs

Equity markets continue to remain bolstered from all sides as the macro environment produces strong numbers, earnings continue to smash estimates and inflation concerns take a back seat. Earnings season switches from bank stocks to reopening plays.

Read more

Forex MAJORS

Cryptocurrencies

Signatures