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Can USD/JPY Surpass The Key 112.00 Resistance?

Aayush Jindal

Aayush Jindal

Key Highlights

  • The US Dollar climbed higher and broke the111.00 resistance against the Japanese Yen.
  • USD/JPY broke a major bearish trend line at111.15 on the 4-hours chart.
  • The US Initial Jobless Claims for the weekending March 30, 2019 declined to 202K from 212K.
  • The US Nonfarm Payrolls in March 2019 could risefrom 20K to 180K.

USDJPY Technical Analysis

After forming a support base above 110.20, the US Dollar steadily climbed higher against the Japanese Yen. The USD/JPY pair surpassed the 111.00 resistance, but it is facing a tough hurdle near 112.00.

USDJPY Technical Analysis US Dollar Japanese Yen

Looking at the 4-hours chart, the pair started a freshincrease from the 109.70 low. It broke the 110.50 and 111.00 resistance levelsto move into a positive zone. There was a close above the 111.00 level, the 100simple moving average (4-hours, red), and the 200 simple moving average(4-hours, green).

Besides, the pair broke a major bearish trend line at 111.15on the same chart. There was also a break above the 61.8% Fib retracement levelof the last decline from the 111.90 high to 109.70 low.

The pair climbed above the 111.50 level recently, but thereis a strong resistance near the 112.00 and 112.10 levels. The 112.00-112.10 areaacted as a barrier on many occasions and it may once again stop the recentrise. However, if today’s NFP release in the US exceeds the market forecast,there are chances of an upside break above 112.00.

Fundamentally, the US Initial Jobless Claims for the weekending March 30, 2019 was released by the US Department of Labor. The market waslooking for a minor rise in claims from 211K to 216K.

The actual result was better than the forecast, as the USInitial Jobless Claims declined to 202K. On the other hand, the last readingwas revised up from 211K to 212K.

The report added:

The 4-week moving average was 213,500, a decrease of 4,000 from the previous week's revised average. The previous week's average was revised up by 250 from 217,250 to 217,500.

Overall, the US dollar bulls remain in control as EUR/USD and GBP/USD continues to slide. More importantly, this time there are chances of an upside break above 112.00 in USD/JPY.

Economic Releases to Watch Today

  • US Nonfarm Payrolls March 2019 – Forecast 180K,versus 20K previous.
  • US Unemployment Rate March 2019 - Forecast 3.8%,versus 3.8% previous.
  • Canada’s employment Change payrolls March 2019 –Forecast 1.0K, versus 55.9K previous.
  • Canada’s Unemployment Rate March 2019 - Forecast5.8%, versus 5.8% previous.