USDJPY Trades in Extended Narrow Range Before Key US Labor Data
USD/JPY continues to hover within a two-week span, consolidating just below multi-year highs in the 151.90/152.00 range (peaking in October 2022, November 2023, and March 2024). The prolonged sideways movement, evident in the pair’s trajectory towards ending a second consecutive week with a tight Doji candle, underscores significant indecision. This stance is influenced by the dollar’s firm support from a considerable interest rate differential between the Federal Reserve and the Bank of Japan, juxtaposed with concerns over potential Japanese intervention to bolster the yen, which continues to limit market activity.
On all major timeframes, technical analyses maintain a bullish outlook, anticipating a robust bullish bias as long as the price remains above the breached 150 level, which has now transformed into a sturdy support. Nevertheless, it’s anticipated that fundamentals will take precedence as the primary driver for the pair’s movements at this juncture.
The markets are anticipating the release of US March labor data to provide fresh signals. The US Non-Farm Payrolls (NFP) are projected to rise by 200K in March, a decrease from the previous month’s increase of 275K. A March figure surpassing expectations is likely to support the dollar, while weaker-than-expected numbers could have the opposite effect.
The initial support is positioned at 150.40 (20-day moving average), acting as a barrier before pivotal levels at 150.00/149.87 (psychological threshold/Fibonacci 38.2% of the 146.48/151.97 upward movement). If breached, this would redirect near-term attention downward, potentially revealing robust support at 149.20 (the upper boundary of the dense daily cloud/Fibonacci 61.8%).
Major obstacles lie within the 152.00 zone. A sustained breakthrough at this level could trigger a more robust bullish surge. However, the prospect of intervention looms large, posing a significant barrier for bullish momentum.
Res: 151.52; 151.97; 152.56; 153.00
Sup: 150.67; 150.40; 150.00; 149.87
