- SWFX market sentiment is 64% bearish (+3%)
- 51% of pending orders in the 100-pip range are to BUY the US Dollar
- Nearest support is located near 113.20
- Upcoming events: US JOLTS Job Openings, Japan's PPI y/y
The US employment grew at a strong pace in November, confirming the country's healthy economic state, which analysts see not requiring the Donald Trumps' proposed fiscal stimulus, even with the moderate pay growth.
The Labour Department showed that non-farm payrolls added 228K positions, while average hourly earnings increased 0.2% in the reported month, boosting the yearly rise in wages to 2.5%. Data also showed the jobless rate unaltered at a 17-year low of 4.1%.
Minor fundamentals
The economic calendar for this session includes two minor fundamentals, namely, the US JOLTS Job Openings and Japan's PPI for November to be released at 1500GMT and 2350GMT, respectively. It is unlikely that any of these events have any impact on the market.
USD/JPY fails to bypass 113.68
Most of the previous trading session the currency rate spent moving towards the 23.6% Fibonacci retracement level located at 114.03. Nevertheless, this target was not achieved due to resistance area formed near the 113.70 mark.As for today, a minor retreat back to 113.20 is possible. However, the Yen unlikely to gain much value due to pressure from the rising 55-, 100- and 200-hour SMAs. On the other hand, it looks like the pair is moving in a new rising wedge formation, which presupposes a breakout towards the 50% retracement level.
In case of such mixed signals there is a need to turn to the overall fundamental picture, which is in favor of the buck, as markets anticipate the interest rate hike.
Hourly chart
The US Dollar has appreciated 2.23% against the Yen during the past two weeks and it seems that the upward movement could continue for the following five days, as well.
Given that the pair has not left the upper boundary of a descending triangle for the past two months, this week might mark an upside breakout from this long-term pattern.
The nearest support/resistance levels in this session are the distant weekly R1 and PP at 114.05 and 113.02, respectively; this gives enough room to move in either direction without any restrictions.
Daily chart
The bearish SWFX sentiment has strengthened in this session, as 64% of open positions are short (+3%). Meanwhile, 59% of pending orders are to buy the US Dollar (+2%).
OANDA traders are also bearish on the pair, with 54% of open positions being short. Saxo Bank clients are also holding 54% short positions.