The USD/IJPY pair has retreated from the 108.16 high to trade around 107.50 and could accelerate its decline once below 107.30. On the data front, Japan’s manufacturing output contracted by more than expected in Q2 while the US will publish the ADP employment survey and the ISM Manufacturing PMI, FXStreet’s Chief Analyst Valeria Bednarik informs.
“Japan published the Tankan Large Manufacturing Index for Q2, which fell to -34, worse than the -31 expected. The June Jibun Bank Manufacturing PMI printed at 40.1, better than the 37.8 expected, while the Consumer Confidence Index for the same month surged to 28.4, beating the market’s forecast.”
“The US session will be focused on employment and growth, as the country will release the ADP survey ahead of the Nonfarm Payroll report to be out on Thursday. The private sector is expected to have added 3 million new jobs in June. Also, the US will publish the ISM Manufacturing PMI, seen in June at 49.5 from 43.1 in May.”
“In the 4 hour chart, USD/JPY is back below its 20 and 200 SMA, and still above a bearish 100 SMA. Technical indicators, in the meantime, eased from overbought readings, but pared their declines near their midlines, indicating easing selling interest.”
“The decline could gather momentum if the pair falls below 107.30, the immediate support.”
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