The US Dollar (USD) extended upside movement against the Japanese Yen (JPY) on Friday, increasing the price of USDJPY to more than 109.50 following the release of some key economic data. The technical bias remains bearish because of a Lower Low in the recent downside move.
Technical Analysis
As of this writing, the pair is being traded near 109.62. A hurdle may be noted near 110.00, the psychological number ahead of 110.60, horizontal resistance and then 111.00, a decisive resistance zone as marked in the following daily chart. A daily closing above 111.000 will push the pair into bullish territory, validating a move towards the 115.00 zone in the long run.
On the downside, the pair is likely to find a support around 108.89, the intraday low of yesterday ahead of 107.63, the swing low of the last major downside move and then 107.00, the psychological number.
US Jobless Claims
The number of Americans filing applications for unemployment benefits unexpectedly declined last week to match a more than 42-year low, indicating employers are upbeat about an economy that bogged down in the first quarter.
Jobless claims dropped by 13,000 to 253,000 in the week ended April 9, equaling the level in March that was the lowest since November 1973, a report from the Labor Department showed Thursday. The median forecast in a Bloomberg survey called for 270,000. Continuing claims also declined, to the lowest since mid-October.
Trade Idea
Considering the overall technical and fundamental outlook, selling the pair around 110.60-111.00 appears to be a good strategy if we get a valid bearish reversal candle near those levels.
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