26 Jul 2013
USD/JPY reversed hard to downside Thursday - barely holding ST support at 98.88
FXstreet.com (Barcelona) - The USD/JPY fell away from an intraday peak of 100.45 early Thursday and cascaded all the way down to short-term support at 98.88 before bouncing modestly late in the day.
Japanese data got the selling started and was undeterred by better jobs data from the US
Early Thursday, traders had a chance to digest foreign investment flow data from Japan. The numbers came out lighter than expected for both bonds and stocks. While the initial reaction was for USD/JPY to rally, sellers quickly took back over and pressured the cross back to the downside. The selling pressure persisted throughout the Thursday session despite better-than-expected weekly jobless claims in the US at 12:30 GMT.
The downside momentum really picked up later in the session, however, on rumors that the US Federal Reserve would resolve to maintain their current pace of open-market bond purchases at their meeting next week. The lows of the session at 98.88 were made at 16:10 GMT.
USD/JPY technical outlook
Some technicians are calling for a move down to 92.53 before the macro bull trend in the cross resumes. Shorter-term support for USD/JPY comes in at the 7/16 pivot and today’s low of 98.88. A break of that level will likely lead a test of the next support at the Fibonacci projections of 98.05 and 97.64. Resistance for USD/JPY comes in at Thursday’s peak at 100.47 and is backed up by key “correction resistance” at the 7/8 intraday high at 101.53.
Japanese data got the selling started and was undeterred by better jobs data from the US
Early Thursday, traders had a chance to digest foreign investment flow data from Japan. The numbers came out lighter than expected for both bonds and stocks. While the initial reaction was for USD/JPY to rally, sellers quickly took back over and pressured the cross back to the downside. The selling pressure persisted throughout the Thursday session despite better-than-expected weekly jobless claims in the US at 12:30 GMT.
The downside momentum really picked up later in the session, however, on rumors that the US Federal Reserve would resolve to maintain their current pace of open-market bond purchases at their meeting next week. The lows of the session at 98.88 were made at 16:10 GMT.
USD/JPY technical outlook
Some technicians are calling for a move down to 92.53 before the macro bull trend in the cross resumes. Shorter-term support for USD/JPY comes in at the 7/16 pivot and today’s low of 98.88. A break of that level will likely lead a test of the next support at the Fibonacci projections of 98.05 and 97.64. Resistance for USD/JPY comes in at Thursday’s peak at 100.47 and is backed up by key “correction resistance” at the 7/8 intraday high at 101.53.