- The share of sell orders decreased from 57 to 53%
- 65% of all open positions are long
- The nearest resistance is located around 103.74
- The closest support rests at 103.33
- Upcoming events: US Retail and Core Retail Sales, US PPI and Core PPI, US Preliminary UoM Consumer Sentiment, Fed Chair Yellen Speech
Еhe number of Americans filing for unemployment benefits remained at its 43-year low last week, official figures showed on Thursday. According to the US Department of Labor, initial jobless claims held at a seasonally adjusted 246,000 in the week ended October 8, while market analysts anticipated a slight increase to 252,000 during the reported period. Meanwhile, the preceding week's figure was revised down to 246,000 from the originally reported reading of 249,000. It was the 84th consecutive week of initial claims remaining below the 300,000 level, the longest streak since 1973. The four-moving average of claims, considered a better measure of labor market trends, declined 3,500 to 249,250 last week, the lowest level since November 1973. The data also showed the number of continuing claims decreased 16,000 to 2.05 million in the week ending October 1, the lowest level since June 2000, while its four-week moving average fell 25,750 to 2.07 million.
In a separate report, the Department of Labor said import prices rose 0.1% month-over-month in September, following August's 0.2% drop and meeting analysts' expectations. On an annual basis, import prices declined 1.1% in the same month, compared to the previous month's 2.2% fall.
US data to drive the USD/JPY pair
On Friday important data from the US side are due, namely the Retail Sales and the PPI. The Retail Sales are released by the US Census Bureau and measure the total receipts of retail stores. Monthly percent changes reflect the rate of changes of such sales. Changes in Retail Sales are widely followed as an indicator of consumer spending. The Core Retail Sales, however, exclude the automobile sector in order to provide a more precise reading. The US PPI is released by the Bureau of Labor Statistics and the Department of Labor, measuring the average changes in prices in primary markets of the US by producers of commodities in all states of processing. Changes in the PPI are widely followed as an indicator of commodity inflation. Another possible event to have some impact will be the Reuters/Michigan Consumer Sentiment Index. It is a survey of personal consumer confidence in economic activity. It shows a picture of whether or not consumers are willing to spend money.USD/JPY to climb back above 104.00
As was anticipated, the Greenback lost some ground on Thursday, having slid back under the 104.00 mark. Nevertheless, the pair has been trading in a bullish trend for three weeks in a row now and technical indicators keep giving bullish signals, both suggesting that another bullish development is due. The Buck has the potential to establish a fresh 11-week high, which would also imply reaching the third resistance level, currently located just under the 115.00 major level. However, week US data today could spark more USD-selling, causing the bearish trend to prevail once again.Daily chart
Although the US Dollar failed to rebound from the three-week up-trend yesterday, the 200-hour SMA managed to provide sufficient support and cause the USD/JPY pair to regain the bullish momentum, therefore, preserving the trend. This situation is bolstering the possibility of the pair reaching the 105.00 level, but due to yesterday's breach attempt, risks of another breakout occurring today are higher.
Hourly chart
Bulls grew in number over the last 24 hours, as there are now 65% of all open positions being long (previously 57%). Meanwhile, the share of sell orders decreased from 57 to 53%.
Meanwhile, there has been a decrease in the number of long positions at other brokers. Right now 57% of OANDA clients are bulls, compared to 59% on Thursday. Saxo Bank clients, however, remain as bullish as on Thursday, being that the portion of longs still takes up 56% of the market.
Spreads (avg, pip) / Trading volume / Volatility
Traders are becoming increasingly bullish the Dollar
According to the poll that gathered forecasts between September 14 and October 14, traders expect the US Dollar to appreciate to 104.90 yen in three months' time, while the forecast for November 30 was only 103.30 yen. It is also worth noticing that 80% of all forecasts fall above 102 yen, which is close to the current spot price. By far the most popular interval is 108.00-109.50, chosen by 19% of all the surveyed, compared to popularity of the 105.00-106.50, 106.50-108.00 and 109.50-111.00 intervals.