USD/JPY – Steady As Markets Await US Unemployment Claims

The Japanese yen has edged higher on Thursday, as the pair trades in the mid-102 range. On the release front, US ADP Nonfarm Payrolls looked dismal in the May release. We’ll get another look at key employment data on Thursday, with the release of Unemployment Claims. In Japan, the only event of the day is the 30-year Bond Auction, which remained unchanged at 1.71%.

Japanese releases have enjoyed a good week. Average Cash Earnings, an important indicator of consumer spending, posted a gain of 0.9%, its best showing since April 2012. Analysts are paying close attention to consumer spending and confidence indicators, as there have been concerns that consumers would tighten up on the purse strings following a sales tax hike in April, which would be bad news for the recovering Japanese economy. As well, Capital Spending posted its strongest gains in almost two years, with a gain of 7.4% in Q1. This easily beat the estimate of 5.7%.

US manufacturing and services sectors are pointed in the right direction, according the ISM Business Survey Committee. The ISM Manufacturing and Non-Manufacturing PMIs both improved in May. There was some confusion earlier in the week, as the Manufacturing PMI was based on faulty data, with the original report stating that the manufacturing index had softened in May. This was later corrected, as the index actually improved to 55.4 points in May, up from 54.9 points a month earlier. Meanwhile, the Non-Manufacturing PMI hit a nine-month high last month, climbing to 56.3 points, ahead of the estimate of 55.6 points.

USD/JPY for Thursday, June 5, 2014

USD/JPY June 5 at 11:35 GMT

USD/JPY 102.48 H: 102.68 L: 102.45

USD/JPY Technical

• USD/JPY has edged lower on Thursday.
• 102.53 is an immediate resistance line, and could break during the day. The next resistance line is at 103.07, which has held firm since early April.
• 101.19 is providing strong support.
• Current range: 101.19 to 102.53

Further levels in both directions:

• Below: 101.19, 100.00, 99.57 and 98.97.
• Above: 102.53, 103.07, 104.17 and 105.70.

OANDA’s Open Positions Ratio

USD/JPY ratio continues to be made up of a majority of long positions, indicating trader bias towards the dollar moving upwards.

USD/JPY is trading in the mid-102 range, as the dollar remains strong. The pair is stable in the European session.

USD/JPY Fundamentals

• 3:45 Japanese 30-y Bond Auction. Actual 0.9%.
• 11:30 US Challenger Job Cuts. Actual 45.5%.
• 12:30 US Unemployment Claims. Estimate 309 thousand.
• 14:30 US Natural Gas Storage. Estimate 116B.
• 17:30 US FOMC Member Narayana Kocherlakota Speaks.

*All release times are GMT

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