Here’s Why USD/JPY Could Revisit 116.40
- USD/JPY is showing positive signs above 115.20.
- A key bullish trend line is forming with support at 115.20 on the 4-hours chart.
- EUR/USD extended decline and traded below 1.1080.
- The US nonfarm payrolls could increase 400K in Feb 2022.
USD/JPY Technical Analysis
The US Dollar remained well bid above the 114.50 level against the Japanese Yen. USD/JPY started a fresh increase and was able to surpass 115.00.
Looking at the 4-hours chart, the pair traded above the 115.20 resistance, the 100 simple moving average (red, 4-hours), and the 200 simple moving average (green, 4-hours).
There was a clear move above the 76.4% Fib retracement level of the downward move from the 115.76 swing high to 114.70 low. It is now showing positive signs above the 115.20 level. There is also a key bullish trend line forming with support at 115.20 on the same chart.
On the upside, the pair is facing a strong resistance near the 116.00 zone. The next major resistance sits near the 116.40 level. A close above 116.40 might start a strong move towards 117.20.
If not, the pair might correct lower below the trend line support. The next key support is near 114.95 and the 200 simple moving average (green, 4-hours), below which USD/JPY could revisit 114.60.
Fundamentally, the US Services Purchasing Managers Index (PMI) for Feb 2022 was released yesterday by Markit Economics. The market was looking for no change in the PMI from 56.7.
The actual result was below the market forecast, as the US Services Purchasing Managers Index (PMI) declined from 56.7 to 56.5.
Looking at EUR/USD, the pair extended decline below the 1.1100 and 1.1080 levels. Besides, GBP/USD is struggling to stay above 1.3300.
- US nonfarm payrolls for Feb 2022 – Forecast 400K, versus 467K previous.
- US Unemployment Rate for Feb 2022 - Forecast 3.9%, versus 4.0% previous.