The worse than expected data signalled to the markets that the Federal Reserve might not hike US interest rates as steeply, as previously thought. Namely, the borrowing costs and with it demand for the USD is now forecast to be lower than previously thought.
On the USD/JPY charts the event resulted in a decline, which by the middle of Thursday's trading appeared to be heading to the 138.00 level or the November low level at 137.67.
Economic Calendar
This week notable events are over.
Next week, starting with Tuesday, the scheduled fundamental events will start to impact the financial markets. At 15:00 GMT, the CB Consumer Confidence could impact the US Dollar's value.
On Wednesday, various US events are expected to cause market moves. At 13:15 GMT, the US ADP Non-Farm Employment Change might cause a minor USD move.
Afterwards, at 13:30 GMT, the US Preliminary Quarterly GDP is set to reveal whether the United States remain in a recession.
The day will end with a speech of the US Federal Reserve Chairman Jerome Powell at the Brooking Institution in Washington at 18:30 GMT.
On Thursday, note the Core PCE Price Index release at 13:30 GMT. The US monetary policymakers watch this index as a measure of inflation, not the Consumer Price Index.
Afterwards, the US ISM Manufacturing PMI could impact the US Dollar's value at 15:00 GMT.
The week is set to end with the release of the United States employment data at 13:30 GMT. The data release consists of the US Average Hourly Earnings changes, Non-Farm Employment Change and Unemployment Rate.
Hourly Chart
A move below the 137.67 level could look for support in the 137.50 and 137.00 levels, before the combination of the 138.50 and the weekly R2 simple pivot point at 138.49 would be reached.
On the other hand, a recovery of the US Dollar against the Japanese Yen could encounter resistance first in the 138.50 level and the weekly R1 simple pivot point at 138.41 and afterwards the 139.00 mark.
USD/JPY daily chart's review
On the daily candle chart, the pair has returned and shortly reached above the 100-day simple moving average, which is located near 142.00. Higher above, note the 50-day SMA near 145.00. Meanwhile, most close by support on this chart is being provided by the 200-day SMA near 137.00.Most recently, despite being pierced, the 100-day SMA acted as resistance and caused the recent decline. Due to that reason, it could be assumed that the 200-day SMA will act as support.
Daily chart
On Thursday, on the Swiss Foreign Exchange, traders were 61% short, as that amount of open position volume was in short positions.
Meanwhile, trader set up pending orders in the 100-pip range around the rate were 65% to sell the USD against the JPY.
On Wednesday, positions were 59% short and pending orders were 70% to buy.