USD/JPY seesaws below 106.50 amid broad US dollar weakness


  • USD/JPY looks for fresh direction to break the immediate trading range.
  • US dollar drops amid downbeat data, pessimistic comments from the Fed policymakers and hopes of negative Fed rate.
  • Risk-on sentiment restricts the pair’s downside.
  • Japan’s Household Spending, Jibun Bank Services PMI in the spotlight, for now.

Having defied a four-day losing streak the previous day, USD/JPY searches for firm direction around 106.30 amid early Friday morning in Asia. Even if the broad US dollar weakness keeps the tab on the pair’s upside off-late, risk-on sentiment has also contributed towards limiting the quote’s declines.

Bulls and bears jostle amid mixed clues…

Higher than expected US Jobless Claims, to 3,169K versus 3,000 forecasts, keeps the fears of a worrisome employment report for April, up for publishing today. Also adding to the greenback weakness could be the comments from the Fed policymakers suggesting the worst is ahead, despite the central bank’s readiness to act. Furthermore, Fed fund pricing indicators signaling a negative Fed rate also weighed on the US dollar.

On the other hand, risk-tone sentiment turned light after Bloomberg mentioned that the top US-China trade negotiators will be on the phone early next week. Also, news that Japan approved Gilead’s famous Remdesivir offered additional strength to the risk-tone as traders in Tokyo returned from three days of holidays.

While portraying the trading sentiment, Wall Street registered gains whereas US Treasuries dropped by the end of Thursday’s session.

Looking forward, Japan’s Household Spending and Jibun Bank Services PMI can offer immediate direction to the pair ahead of the pre-NFP trading lull. Forecasts suggest, Overall Household Spending to slump to -6.7% from -0.3% while Jibun Bank Services PMI could weaken to 22.8 from 33.8. For the US April month employment report, headline Nonfarm Payrolls (NFP) could drop to -22000K from -701K whereas Unemployment Rate might zoom up to 14.0% versus 4.4% earlier.

Other than the economics, updates concerning the US-China relations and economic restart in the US, Europe, coupled with virus data, can also direct the pair’s near-term moves.

Technical analysis

Sellers look for entry below a three-week-old falling trend line, at 106.00 now, quickly followed by March 10 top near 105.90. Meanwhile, the monthly resistance line, currently around 107.15, becomes an important upside barrier for the buyers.

Additional important levels

Overview
Today last price 106.3
Today Daily Change 0.18
Today Daily Change % 0.17%
Today daily open 106.12
 
Trends
Daily SMA20 107.37
Daily SMA50 107.7
Daily SMA100 108.65
Daily SMA200 108.26
 
Levels
Previous Daily High 106.63
Previous Daily Low 105.99
Previous Weekly High 107.62
Previous Weekly Low 106.36
Previous Monthly High 109.38
Previous Monthly Low 106.36
Daily Fibonacci 38.2% 106.23
Daily Fibonacci 61.8% 106.38
Daily Pivot Point S1 105.87
Daily Pivot Point S2 105.61
Daily Pivot Point S3 105.23
Daily Pivot Point R1 106.5
Daily Pivot Point R2 106.88
Daily Pivot Point R3 107.14

 

 

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