The continuation of the current selling operations of the USD/JPY currency pair’s price performance may push the bears to move towards the psychological support level of 130.00, most important to evaporate the bullish hopes that dominated the currency pair’s performance recently.
- For two days in a row, the price of the USD/JPY currency pair is exposed amid profit-taking sales, with losses affecting the support level of 131.52, and settling around the level of 131.70 at the time of writing the analysis.
- The performance came as the US dollar is exposed to downward pressures ahead of the announcement of the important US job numbers, which affect the expectations of raising US interest rates, which have recently suffered a setback in light of the collapse of US banks, following the US tightening policy.
The yen is a popular asset during turbulent times.
According to recent trading, the US stock market stopped rising for four days, amid selling operations in bank stocks. Treasury yields rose as employment data boosted bets that the US Federal Reserve is about to end its tightening campaign.
And a benchmark for heavyweight securities such as Wells Fargo & Co. and Citigroup Inc. by 2.5 percent. Regional banks were led by shares of Zion Bancorp and First Republic Bank, which fell at least 5.5 percent. In his broad annual letter to shareholders, Jamie Dimon, chairman of JPMorgan Chase & Co, warned that the US banking crisis that sent markets crashing last month will be felt for years.
For his part, Gennady Goldberg, chief US price analyst at TD Securities, said that “Investors should continue to be vigilant for signs of banking stress, and we expect market participants to react disproportionately to negative economic news.”
According to official figures, job vacancies at US employers fell to the lowest level since May 2021, according to the Labor Department’s Job Opportunities and Employment Turnover Survey, or JOLTS. The data precedes Friday’s US jobs report, which is currently expected to show employers added nearly a quarter of a million workers in March. Economists expect the unemployment rate to remain at a historically low level of 3.6 percent and average hourly earnings to rise steadily.
The two-year yield fell by 14 basis points, to about 3.8 percent. Swaps that indicate the dates of the Fed’s meetings cut the odds of a quarter-point rate hike in May to less than 50 percent, from about 60 percent. Ahead of Tuesday’s economic numbers, Fed Governor Lisa Cook said that given the strength of the labor market “we’re still seeing inflation from that, but we’ve seen wage gains fairly moderate,”. This suggests that the “inflationary process” is underway, but that “we’re not there yet”.
The continuation of the current selling operations of the USD/JPY currency pair’s price performance may push the bears to move towards the psychological support level of 130.00, most important to evaporate the bullish hopes that dominated the currency pair’s performance recently. It is less than this support may be considered to return to the purchase of the currency pair. Especially if the US job numbers came out stronger than expected.
On the other hand, the return of breaching the 133.80 resistance may give hope to the bulls to complete the last bounce.
Today, the USD/JPY will be affected by the extent to which investors take risks or not, along with the reaction to the announcement of the first US jobs data, the ADP reading of the change in non-agricultural employment, along with the trade balance numbers and the reading of the ISM services PMI.