Key Highlights
- The US Dollar is trading higher and approaching a major resistance at 113.40 against the Japanese Yen.
- There are two bullish trend lines formed with support at 112.70 and 111.80 on the 4-hours chart of USD/JPY.
- The US Initial Jobless Claims for the week ending Oct 14, 2017 posted a decline from the last revised reading of 244K to 222K.
- Today in Canada, the Consumer Price Index (CPI) for Sep 2017 will be released, which is forecasted to increase by 1.6% (YoY).
USDJPY Technical Analysis
The US Dollar bounced sharply from 111.65 against the Japanese Yen. The USD/JPY pair is now approaching a crucial resistance near 113.40, which is a breakout point.
The pair is currently well above the 76.4% Fib retracement level of the last decline from the 113.44 high to 111.63 low. Therefore, there are chances of an upside break above 113.40. However, a break won’t be easy since the 113.30-40 region prevented gains on many occasions.
On the downside, there are two bullish trend lines formed with support at 112.70 and 111.80 on the 4-hours chart. As long as the pair is above the 112.50 level, there is a chance of an upside break towards 113.85 in the near term.
US Initial Jobless Claims
Recently in the US, the Initial Jobless Claims report for the week ending Oct 14, 2017 was released by the US Department of Labor. The forecast was slated for a decline from the last reading of 243K to 240K.
The actual result was way above the forecast, as there was a decline to 222K. On the other hand, the last reading was revised up from 243K to 244K. The 4-week moving average was down by 9,500 from the previous week’s revised average of 257,750 to 248,250.
The report stated:
The advance number for seasonally adjusted insured unemployment during the week ending October 7 was 1,888,000, a decrease of 16,000 from the previous week’s revised level. This is the lowest level for insured unemployment since December 29, 1973 when it was 1,805,000.
Overall, the USD/JPY pair is gaining pace, and a break above 113.40 would open the doors for more gains, probably towards 113.85.
