USDJPY Technical Analysis: October 13, 2017

Key Highlights

  • The US Dollar after struggling to move above 113.40 against the Japanese Yen started a downside move.
  • There was a break below a major bullish trend line at 112.50 on the 4-hours chart of USD/JPY.
  • The US Initial Jobless Claims for the week ending Oct 7, 2017 posted a decline from 258K (revised) to 243K.
  • Today in the US, the CPI figure for Sep 2017 will be published, which is forecasted to increase 2.3% (YoY).

USDJPY Technical Analysis

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The US Dollar failed to move past 113.40 against the Japanese Yen and later started a downside move. The USD/JPY pair is now in the bearish zone and looks set to extend declines.

During the downside move, the pair broke the 23.6% Fib retracement level of the last wave from the 109.54 low to 113.41 high. Moreover, there was a break below a major bullish trend line at 112.50 on the 4-hours chart.

A close below 112.80 has opened the doors for more declines in the near term. The next major support is at 111.50 and the 50% Fib retracement level of the last wave from the 109.54 low to 113.41 high.

On the upside, buyers need to push the pair back above 112.80 and 113.00 to avoid any further declines.

US Initial Jobless Claims

Recently, the US saw the release of the Initial Jobless Claims for the week ending Oct 7, 2017 by the US Department of Labor. The forecast was slated for a decline from 260K to 251K.

The actual result was better the forecast, as there a decline to 243K and the last reading was revised down to 285K. Looking at the 4-week moving average, there was a decline of 9,500 from the previous week’s revised average of 267,000 257,500.

The report added that:

The advance number for seasonally adjusted insured unemployment during the week ending September 30 was 1,889,000, a decrease of 32,000 from the previous week’s revised level.

The outcome was positive, but the current USD/JPY trend seems to be bearish below 113.00 in the short term.

Other Economic Releases to Watch Today

  • German Consumer Price Index for Sep 2017 (YoY) – Forecast +1.8%, versus +1.8% previous.
  • German Consumer Price Index for Sep 2017 (MoM) – Forecast +0.1%, versus +0.1% previous.
  • US Retail Sales Sep 2017 (MoM) – Forecast +1.7%, versus -0.2% previous.
  • US Consumer Price Index Sep 2017 (MoM) – Forecast +0.6%, versus +0.4% previous.
  • US Consumer Price Index Sep 2017 (YoY) – Forecast +2.3%, versus +1.9% previous.
  • US Consumer Price Index Ex Food & Energy Sep 2017 (YoY) – Forecast +1.8%, versus +1.7% previous.
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