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COZfx: USD/JPY weekly outlook

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COZfx: USD/JPY weekly outlook

Postby dwang » Mon Jun 02, 2014 2:56 am

COZforex: The dollar ended Friday’s session almost unchanged against the yen, after slipping lower earlier in the day following the release of some soft US data on personal spending and consumer confidence.

USD/JPY touched session lows of 101.51 before pulling back to 101.76 late Friday. For the week, the pair slid 0.14%. COZforex senior currency strategist Ian • Quigley said, USD/JPY is predicted to find support at 101.37, and a drop through could take it to the next support line of 101.18. Meanwhile, the pair is predicted to find its first resistance at 101.78, and a rise through could take it to the next resistance line of 102.01.

The dollar eased after data showed that US consumer spending fell 0.1% in April from a month earlier, missing forecasts for a 0.2% increase. Personal income rise 0.3%, in line with forecasts. Separately, the final reading of the University of Michigan's consumer-sentiment index for May came in at 81.9, up slightly from a preliminary reading of 81.8, but falling short of forecasts for 82.5.

The yen was also boosted by decline in US 10-year Treasury yields. US bonds have rallied in recent sessions as buying in 10-year Treasury notes pushed yields to the lowest levels since January. Profit taking by investors on Friday pulled the yield on 10-year notes back up to 2.48% late Friday.

Demand for the yen continued to be underpinned by diminished expectations for more stimulus by the Bank of Japan, after the bank said earlier this month that its stimulus program has been working as intended.

In the week ahead, investors will be looking to Friday’s US nonfarm payrolls report for May for further indications on the strength of the labor market, while Tuesday’s euro zone inflation report will also be in focus, ahead of the ECB policy meeting and press conference on Thursday.


(COZ forex UK)
dwang
 
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