USDJPY – Signs of Weakness Evident13 November, 2015 by Aayush Jindal in Fundamental Analysis, Market Analysis, Technical Analysis, USDJPY
USDJPY – Signs of Weakness Evident, More Losses Likely?
- The US Dollar struggled during the past couple of sessions as the US initial jobless claims data failed to impress the investors.
- USDJPY pair is currently trading lower after testing the 123.50-60 resistance zone.
- Japanese Industrial Production report will be released by the Ministry of Economy, Trade and Industry today, which is forecasted to post a gain of around 1%.
USDJPY Technical Analysis
The US Dollar after trading as high as 123.60 against the Japanese Yen found sellers and started to move lower. There is a bearish trend line formed on the hourly chart of the USDJPY pair, which is acting as a hurdle for buyers in taking the pair higher.
The most important point is the fact that the pair has now settled below the 100 hourly simple moving average and might be heading towards the 200 hourly MA. The stated MA is also coinciding with the 76.4% Fib retracement level of the last leg from the 121.85 low to 123.59 high.
In short, the USDJPY pair might continue trading lower, but it could find support near the 122.25-30 area.
US Initial Jobless Claims
Recently in the US, the Initial Jobless Claims, representing the measure of the number of people filing first-time claims for state unemployment insurance was released by the US Department of Labor. The market was expecting the US Initial Jobless Claims to decrease from 276K to 270K as per the seasonally adjusted terms. However, the outcome failed to match the forecast, as the US initial jobless claims came in at 276K. When we look at the 4-week moving average, then it was 267,750, which is 5,000 higher compared to the previous week’s unrevised average.
Overall, the report resulted in a bearish pressure on the US Dollar, and pushed the greenback lower. The USDJPY pair looks like struggling at the moment and more losses are possible.
There is an important release in Japan today, as the Industrial Production, which measures outputs of the Japanese factories and mines will be reported by the Ministry of Economy, Trade and Industry. Let us see whether there is a substantial increase in the production recently or not, as it may have an impact on the Yen pairs.