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USD/JPY reaches 1-week highs on encouraging US data.

  • USD/JPY turns positive for the third day in a row and hits 1-week highs.
  • Upbeat US macro data supports the USD and remains support for the move.
  • A combination of factors could support the yen and limit the pair’s rise.

The pair USD/JPY receives some offers during the first hours of the North American session and reaches highs of a week in reaction to the encouraging macroeconomic data from the United States. The pair currently sits just above 133.50 and is looking to consolidate this week’s rally move from its lowest level since June 2022.

The US dollar strengthened across the board following the release of the better-than-expected US ADP report, which in turn lifted the USD/JPY for the third day in a row. In fact, US private sector employers added 235,000 jobs in December versus consensus estimates for a reading of 150,000. Additionally, initial claims for jobless benefits unexpectedly fell from 223,000 to 204,000 during the week ending December 30.

This comes after the Federal Open Market Committee (FOMC) meeting minutes were released on Wednesday, and triggers a sharp intraday rally in US Treasury yields. This, in turn, provides a nice boost to the dollar and acts as a tailwind for the USD/JPY pair. Aside from this, the technical buy above 133.00 could also be attributed to the latest leg seen over the past hour or so.

However, information that the Bank of Japan plans to raise its inflation forecasts could support the yen and limit gains. Apart from this, the risk aversion momentum, which tends to benefit the JPY’s relative safe-haven status, could further contribute to keeping the USD/JPY subdued, at least for the time being. This, in turn, warrants some caution on the part of aggressive bullish traders.

Technical levels to watch

USD/JPY

Overview
Last price today 133.69
Today Change Daily 1.01
today’s daily variation 0.76
today’s daily opening 132.68
Trends
daily SMA20 134.12
daily SMA50 138.58
daily SMA100 141.02
daily SMA200 136.36
levels
previous daily high 132.72
previous daily low 129.93
Previous Weekly High 134.5
previous weekly low 130.78
Previous Monthly High 138.18
Previous monthly minimum 130.57
Fibonacci daily 38.2 131.65
Fibonacci 61.8% daily 130.99
Daily Pivot Point S1 130.83
Daily Pivot Point S2 128.98
Daily Pivot Point S3 128.04
Daily Pivot Point R1 133.63
Daily Pivot Point R2 134.57
Daily Pivot Point R3 136.42

Source: Fx Street

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