USD/JPY tumbles to weekly lows after US jobless claims

Haresh Menghani FXStreet

The USD/JPY pair accelerated the bearish slide and broke through the 113.00 handle, dropping to a multi-day lows during early NA session.

Currently trading around 112.70 region, testing session lows, the pair came under some fresh selling pressure as market participants seemed unimpressed by comments from the US Treasury Secretary Steve Mnuchin, at an interview on CNBC.

Mnuchin said he wants to see "very significant" tax reform passed before Congress' August recess but failed to provide any specific details of the proposed reforms. He further added that new policies will have limited impact in 2017 and it could take until late 2018 to reach 3% GDP growth.

In addition, data released from the US showed initial jobless claims rose more-than-expected to 244K for the week ended Feb. 17, up from previous week’s 239K and 241K expected, and failed to provid any respite for the US Dollar bulls.

Later during the day, speeches from Atlanta Fed President Dennis Lockhart and Dallas Fed President Robert Kaplan would now be looked upon for some fresh impetus.

Technical levels to watch

A follow through weakness below 112.60 level (Feb. 17 low) could get extended towards 112.40-35 horizontal support, which if broken is likely to drag the pair below 112.00 handle towards testing its next support near 111.60 level.

On the upside, any recovery attempts back above 113.00 handle now seems to confront immediate strong resistance near 113.45-50 region, which if cleared could lift the pair back towards 113.75-80 resistance area, en-route 114.00 round figure mark.

1 Week
1 Month
1 Quarter

1 Week

Avg Forecast 112.65

33% Bullish
33% Bearish
33% Sideways

Bias Neutral

1 Month

Avg Forecast 114.51

62% Bullish
8% Bearish
31% Sideways

Bias Bullish

1 Quarter

Avg Forecast 115.76

61% Bullish
0% Bearish
39% Sideways

Bias Bullish

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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