USDJPY Might Target Additional Weakness21 August, 2015 by Aayush Jindal in Fundamental Analysis, Market Analysis, Technical Analysis, USDJPY
- US Dollar moved lower and likely to weaken further against the Japanese Yen moving ahead.
- US Initial Jobless Claims released by the US Department of Labor increased from the last revised reading of 273K to 277K.
- US continuing jobless claims came below the forecast and posted a reading of 2.254M.
- US Existing Home Sales, released by the National Association of Realtors increased by 2% in July 2015, compared to the preceding month whereas the market was expecting a decline of 0.6%.
USDJPY Technical Analysis
The USDJPY pair remained under the bearish pressure Intraday, and traded lower. There was an important flag pattern formed on the hourly chart, which finally paved the way for more declines in the near term. The pair traded towards 123.75 before starting a correction.
The correction stalled around the broken flag support area, which was coinciding with the 61.8% Fib retracement level of the last leg from the 123.45 high.
On the downside, an initial support can be seen around the last low of 123.54, followed by 123.10.
US Initial Jobless Claims
Earlier during the NY session, the Initial Jobless Claims, which is a measure of the number of people filing first-time claims for state unemployment insurance was released by the US Department of Labor. The forecast was lined up for a decrease from 274K to 272K in the week ending August 15, as per the advance figure for seasonally adjusted. However, the outcome was just below the forecast, as the US Initial Jobless Claims increased to 277K. The 4-week moving average now stands around the 271,500 level, which is 5,500 more than compared to the previous week’s revised average of 266,000.
The US continuing jobless claims data on the other hand was on the higher side, as it decreased from 2.278M to 2.254M.
There was one more release lined up, as the US Existing Home Sales i.e. an estimated value of housing market conditions and a sensitive factor to the US economy was released by the National Association of Realtors. The market was expecting it to decrease by 0.6% in July 2015, compared to the preceding month. However, the outcome was above the forecast, as the US Existing Home Sales gained by 2% to 5.59M, compared to the forecast of 5.44M.