USD/JPY Daily Forecast – Test Of 105.70 Yielded No Results

U.S. Dollar Is Gaining Some Ground Against The Yen

USD/JPY is trading near 105.50 after an unsuccessful attempt to settle above the significant resistance level at 105.70.

The U.S. Dollar Index, which measures the strength of the U.S. dollar against a broad basket of currencies, has recently made an attempt to settle below the nearest support level at the 20 EMA at 93.65.

This attempt was not successful, and the U.S. Dollar Index is currently trying to get closer to the nearest resistance level at the 50 EMA at 93.90 which is bullish for USD/JPY.

Today, USD/JPY traders will focus on the upcoming U.S. employment reports which may have a significant impact on the dynamics of the American currency.

U.S. Initial Jobless Claims are projected to decline from 870,000 to 850,000. Continuing Jobless Claims are expected to fall from 12.58 million to 12.23 million.

Analysts do not expect to see major improvements on the job front. In case U.S. employment reports are better than the analyst consensus, traders will likely increase their purchases of riskier assets, and the U.S. dollar may find itself under pressure against a broad basket of currencies.

However, it remains to be seen whether such scenario will be bearish for the dollar against the yen, which also serves as a safe haven asset.

Technical Analysis

USD/JPY failed to settle above the key resistance level at 105.70 but did not develop any downside momentum.

In case USD/JPY manages to get above the resistance at 105.70, it will immediately get to the test of the resistance at the 50 EMA at 105.80.

A move above the 50 EMA will open the way to the next significant resistance level at 106.30. If USD/JPY moves above the resistance at 106.30, it will get to the test of September highs at 106.55.

On the support side, USD/JPY has recently received some support at 105.40. A move below this level will open the way to the test of the next support level at 105.20.

If USD/JPY gets below 105.20, it will head towards the next support level at 104.90. #USD/JPY##FX#

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