Key Highlights
- The US Dollar made a good comeback from the 110.80 support against the Japanese Yen.
- The USD/JPY pair is now forming a decent uptrend and is following a bullish trend line with support at 112.40 on the 4-hours chart.
- The US initial jobless claims for the week ending Dec 2, 2017 declined from 238K to 236K.
- Today’s US Nonfarm payrolls release for November 2017 is likely to impact the greenback with an expectation of 200K.
USDJPY Technical Analysis
After a bearish run from the 114.75 resistance, the US Dollar formed support around 111.00 against the Japanese Yen. The USD/JPY pair is now in an uptrend and awaits Nov’s nonfarm payroll figure for the next move.
It seems like there is a solid support base formed at 110.80 in USD/JPY. There was a RSI divergence created from the mentioned 110.80, which ignited an upside rally.
The pair succeeded in breaking a few important barriers such as 111.50 and 112.00. More importantly, there was a close above 112.00 and the 100 simple moving average (red, 4-hour).
At the outset, the pair is facing a tough challenge near the 113.70-80 resistance. Furthermore, the 76.4% Fib retracement level of the last major drop from 114.73 to 110.84 is at 113.81.
Therefore, the 113.80-114.00 region is an important resistance for further gains in USD/JPY. Should the US NFP data beats the forecast, the pair could easily move above 114.00 in the near term. In terms of the support, there is a crucial bullish trend line forming with support at 112.40 on the same chart.
On the other hand, other majors such as EUR/USD and GBP/USD were seen struggling ahead of the all-important release. EUR/USD broke a key support at 1.1840 and GBP/USD struggled to move above the 1.3600 resistance level.
In addition, gold price extended declines below the $1260 support area and is placed well in the bearish zone.
To sum up, the market is waiting for the November 2017 Nonfarm payrolls report by the US Department of Labor. The forecast is slated for 200K, less than the last 261K. The unemployment rate is forecasted to remain stable at 4.1%. Should the US NFP post less than 180K, the US Dollar might move down in the short term. On the flip side, an increase of more than 200K would accelerate USD/JPY’s rise above 114.00 and EUR/USD’s decline below 1.1750.
