- SWFX market sentiment is 59% bearish (-2%)
- 52% of pending orders in the 100-pip range are to BUY the Greenback
- Notable support around 112.90
- Upcoming events: US Average Hourly Earnings m/m, US Non-Farm Employment Change, US Unemployment Rate, US ISM Non-Manufacturing PMI, FOMC Member Mester to speak
The US private companies added 250K positions in December, the strongest monthly gain since March, the ADP Research Institute revealed on Thursday. .
The figures came in ahead of the official Labour Department's report, which includes both private and public-sector employment. The jobless rate is expected to remain at 4.1% in the same month. Separately, Markit said that the country's services sector activity softened at a weaker-than-anticipated pace, with PMI falling from 54.5 to 53.7 points in December, but still in the expansion range.
Day for US fundamentals
Friday's trading session is allocated entirely to fundamentals from the United States. The Bureau of Labour Statistics is to release Average Hourly Earnings, Non-Farm Employment Change and Unemployment Rate for December at 1330GMT.
In addition, the Institute for Supply Management will publish its Non-Manufacturing PMI for the same month at 1500GMT.
Finally, the President of the Federal Reserve Bank of Cleveland Loretta Mester is due to participate in a panel discussion ‘Coordinating Conventional and Unconventional monetary Policies for Macroeconomic Stability' at 1730GMT.
USD/JPY bypasses 200-hour SMA
Because of release of better than expected information on employment change in the United States, the buck took the lead and in the first hours of this trading session successfully bypassed combined resistance put by the weekly PP and the 200-hour SMA.In larger perspective, the surge should be attributed to junior ascending channel, which guided the pair towards the upper trend-line of a medium scale symmetrical triangle through this week.
From trade pattern's perspective, the pair should make a rebound somewhere near the 113.10 level and resume the downward movement. But since the rate has crossed practically all technical barriers on its way, it has a good chance to break the above pattern and continue to climb towards the weekly R1 at 113.26.
Hourly chart
The US Dollar has re-gained some strength against the Yen, thus continuing to appreciate for the third consecutive session. The pair managed to breach the monthly PP mid-Thursday and has since been moving even higher past the weekly PP and the 55-day SMA at 112.87 and 112.98, respectively.
The nearest resistance is set by the weekly R1 at 113.26. This line is expected to provide a strong barrier; however, a breakout it still possible. In terms of support, bears might fail to breach the 112.85 area.
Daily chart
SWFX market sentiment remains bearish with 59% short positions (-2%). However, it has decreased gradually during the past few sessions, thus showing a possible change in market conditions. Meanwhile, 59% of pending orders are to buy the Greenback (+1%).
OANDA traders are bullish on the pair, as they are holding 57% long positions (-1%). On the other hand, market sentiment of Saxo Bank stands at equilibrium, compared to 52% long position on the previous day.