USD/JPY – Yen Edges Higher as US JOLTS Job Report Slips

USD/JPY has posted slight losses in the Tuesday session. In North American trade, the pair is trading at 115.70. On the release front, Japanese Consumer Confidence improved to 43.1 points, above the forecast of 41.3 points. In the US, JOLTS Jobs Openings edged lower to 5.52 million, shy of the estimate of 5.59 million.

The US released key employment numbers on Friday, and the markets responded with a thumbs-up, which boosted the US dollar. Wages rebounded in December, as Average Hourly Earnings climbed 0.4%, edging above the estimate of 0.3%. This marked a strong turnaround after the November reading of -0.1%. The news was not as bright from Nonfarm Payrolls, which dropped to 156 thousand, well off the estimate of 175 thousand. This marked a 3-month low, but the dollar still posted gains. The unemployment rate edged up to 4.7%, matching the forecast.

Last week’s Federal Reserve minutes were cautious in tone. The ensuing thumbs-down from the market sent the US dollar broadly lower. In the minutes, Fed policymakers essentially said that monetary policy in the coming months will be dictated in large part by the economic platform of the incoming Trump administration, a platform which remains unclear. FOMC members expressed concern about higher inflation levels, given the “prospects for more expansionary fiscal policies in the coming years”. This is a clear reference to president-elect Trump’s plans to increase fiscal spending and cut taxes, which would likely result in higher inflation, something the US hasn’t had to deal with in years. Still, policymakers haven’t changed their view that gradual rate hikes remains an appropriate monetary policy. Many analysts are predicting another rate hike in June, but this forecast could easily change, depending on the performance of the US economy in the first half of 2017.

Tuesday (January 10)

• 00:00 Japanese Consumer Confidence. Estimate 41.3. Actual 43.1
• 6:00 US NFIB Small Business Index. Estimate 99.6. Actual 105.8
• 10:00 US JOLTS Job Openings. Estimate 5.59M. Actual 5.52M
• 10:00 US Final Wholesale Inventories. Estimate 0.9%. Actual 0.2%
• 10:45 Japanese 10-year Bond Auction

*All release times are GMT

*Key events are in bold

USD/JPY for Tuesday, January 10, 2017

USD/JPY January 10 at 10:30 EST

Open: 115.99 High: 116.34 Low: 115.19 Close: 115.70

USD/JPY Technical

• USD/JPY posted losses in the Asian session but rebounded in European trade. The pair has posted losses in the North American session
• 114.83 is providing support
• 115.88 is a fluid line. Currently, it is a weak resistance line.
• Current range: 114.83 to 115.88

Further levels in both directions:

• Below: 114.83, 113.80 and 112.57
•  Above: 115.88, 116.88, 118.05 and 118.85

OANDA’s Open Positions Ratio

USD/JPY ratio is showing gains in long positions. Currently, short positions have a small majority (51%). This is indicative of a lack of trader bias towards what direction USD/JPY will take next.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.