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Wednesday, November 12, 2014

USD/JPY – Yen Posts Gains as Japanese Data Improves














The Japanese yen has posted slight gains on Wednesday, as USD/JPY trades slightly above the 115 line late in the European session. In Japan, Tertiary Industry Activity looked strong, posting a gain of 1.0%. Later in the day, Core Machinery Orders we’ll be released. There are no major releases out of the US until Thursday.

Japanese data has looked sharp this week. On Wednesday, Tertiary Industry Activity gained 1.0%, edging above the estimate of 0.9%. This was the indicator’s strongest gain since April. Earlier in the week, Japanese Current Account looked solid, as the current account surplus improved to JPY 0.41 trillion. This easily beat the estimate of JPY 0.03 trillion and marked the highest surplus since August 2013.
Employment numbers have been strong in the US, and this played a major role in the Fed decision to wind up QE last week. However, US Nonfarm Payrolls, the most important employment indicator, disappointed on Friday. The indicator slipped to 214 thousand, well short of the estimate of 235 thousand. On a brighter note, the unemployment rate slipped to 5.8%, its lowest level in six years. On Thursday, Unemployment Claims fell to 278 thousand. This was better than the estimate of 285 thousand and marked a three-week low.

USD/JPY for Wednesday, November 12, 2014

USD/JPY November 12 at 12:30 GMT
USD/JPY 115.17 H: 115.88 L: 115.09

USD/JPY Technical
S3 S2 S1 R1 R2 R3
112.94 113.68 114.65 115.75 116.66 117.94

  • USD/JPY broke below support at 115.75 early in the Asian session. The pair is steady in European trade.
  • 115.75 has reverted to a resistance role as the yen has improved.
  • 114.65 is an immediate support line. 113.68 is stronger.
  • Current range: 114.65 to 115.75
Further levels in both directions:
  • Below: 114.65, 113.68, 112.94 and 110.68
  • Above: 115.75, 116.66, 117.94, 118.89 and 119.83

OANDA’s Open Positions Ratio
USD/JPY is pointing to gains in short positions on Wednesday, reversing the direction we saw a day earlier. This is not consistent with the pair’s movement, as the yen has posted gains. The ratio currently has a majority of long positions, indicative of trader bias towards the US dollar moving higher.

USD/JPY Fundamentals
  • 8:00 US FOMC Member Charles Plosser Speaks.
  • 15:00 US Wholesale Inventories. Estimate 0.3%.
  • 17:00 US FOMC Member Narayana Kocherlakota Speaks.
  • 18:01 US 10-year Bond Auction.
  • 23:50 Japanese Core Machinery Orders. Estimate-1.0%.
*Key releases are highlighted in bold
*All release times are GMT

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