- Still no gap between the buy (50%) and sell (50%) orders
- Portion of bulls fell to 61%
- Aug 1 high at 102.50 is intra-day target
- Strong support is at 100.70
- 52% of the survey participants expect the US Dollar to cost less than 108.00 yen in three months
- Upcoming events: US Non-Farm Payrolls, Average Hourly Earnings, Unemployment Rate
The number of Americans filing for unemployment benefits increased to 269,000 in the week ended July 30, compared to the preceding week's reading of 266,000, whereas market analysts pencilled in a slight drop to 265,000 in the reported period, fresh figures from the Department of Labour showed on Wednesday. The 269,000 initial jobless claims figure reported last week marked 74 consecutive weeks of claims under the 300,000 level, the longest streak since 1973. The data also showed that the four-week moving average of claims, considered a better measure of labour market trends, grew 3,750 to 260,250 in the reported week. A Labour Department analyst highlighted that there were no special factors influencing last week's claims data. In the meantime, the number of continuous jobless claims fell 6,000 to 2.14 million in the week ended July 23, while the four-week moving average jumped 5,250 to 2.14 million.
Last week's claims report has no impact on the NFP data for July, set for release on Friday. Economic desks forecast nonfarm payrolls to show growth of 180,000 for the seventh month of the year, following June's spike of 287,000.
NFP to return below 200K
Today's non-farm payrolls are expected to come in more in line with what we saw in spring, namely around 180K, after 287K we saw a month ago, when the actual release was more than 100K higher than the consensus forecast. At the same time, the market consensus is that growth in average hourly earnings will accelerate from 0.1 to 0.2%.USD/JPY consolidates above 100.70
Support at 100.70 holds, meaning there is still a good chance of a rally, first up to 103 and then up to 105 yen. The former resistance is created by the monthly pivot point, while the latter a lot denser supply zone is much less likely to let the price increase further. There the bulls will encounter the six-month down-trend and the 55-day SMA. Alternatively, if the scenario suggested by the indicators materialises and both 100.70 and 100 fall victim to the selling pressure, we will expect a bullish correction to start only circa 97 yen, when the rate meets the lower bound of the bearish channel.Daily chart
Bullish near-term outlook is also confirmed by the situation in the hourly chart, but here the first target is 102.50 (Aug 1 highs), followed by the resistance trend-line and the 200-hour SMA at 103 yen, if the bulls manage to push the price above more recent highs at 101.50.
Hourly chart
A portion of bulls fell below the level seen five days ago, namely from 66 down to 61%. As for the orders, however, there is still no gap between the buy (50%) and sell (50%) ones.
Contrary to what happened in the SWFX market, the share of bulls at OANDA and Saxo Bank either stayed the same or even increased. In the first case the portion of long positions is at 69%, little changed from 70% recorded yesterday. At the same time, 68% of Saxo Bank traders are now long the Dollar, up from 65% seen 24 hours ago.
Spreads (avg, pip) / Trading volume / Volatility
Slightly more than a half expect the exchange rate to fall below 108.00 yen
Slightly more than half of the surveyed (52%) now assume that the US Dollar is to cost less than 108.00 yen after a three month time. The most popular choice, however, implies that the Greenback is to cost between 108.00 and 109.50 yen in three months, selected by 19% of the voters. According to the votes collected between July 01 and August 01, the mean forecast for November 01 is 106.46. At the same time, 18% of the surveyed believe the Greenback could cost more than 112.50 yen in three months.