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16 Aug 2013
USD/JPY struggling to hold 97.00 correction support after sharp intraday pullback
FXstreet.com (Barcelona) - The USD/JPY cross rallied sharply into the releases of multiple data points in the US Thursday and sold off steadily once that data came out. Bulls hoping it is just a correction.
US data surprises on the downside
It had been a while since any “bad” data emanated from the US, but that changed in a hurry between the hours of12:30 GMT and 14:00 GMT. Traders first saw in-line CPI data and better-than-expected jobless claims data – which gave USD/JPY bulls hope. However, those hopes were quickly dashed when two manufacturing reports, Treasury International Capital flow and Industrial Production / Capacity Utilization data all came in on the bearish side of the ledger. The worst of the news could be found in the Philly Fed Manufacturing Survey which showed far lower numbers than expected.
The news flow sent the USD/JPY into a tailspin throughout the rest of the session Thursday. The cross peaked out at 98.64 at 12:30 GMT and is now trading just above key “correction support” at 97.06.
Technical outlook for USD/JPY
Technicians are mixed on the short-term outlook for the USD/JPY. Some are lined up with the logicians and calling for a resumption in the macro uptrend. Others are still calling for a move down to the 92.50 – 92.60 range before resuming the macro uptrend. Short-term resistance comes in at 98.75 (Fibonacci projection) and is followed by the 8/1 close at 99.54. Short-term support comes in at 97.06 and is followed up by 96.00 - both of which are horizontal lines of support.
US data surprises on the downside
It had been a while since any “bad” data emanated from the US, but that changed in a hurry between the hours of12:30 GMT and 14:00 GMT. Traders first saw in-line CPI data and better-than-expected jobless claims data – which gave USD/JPY bulls hope. However, those hopes were quickly dashed when two manufacturing reports, Treasury International Capital flow and Industrial Production / Capacity Utilization data all came in on the bearish side of the ledger. The worst of the news could be found in the Philly Fed Manufacturing Survey which showed far lower numbers than expected.
The news flow sent the USD/JPY into a tailspin throughout the rest of the session Thursday. The cross peaked out at 98.64 at 12:30 GMT and is now trading just above key “correction support” at 97.06.
Technical outlook for USD/JPY
Technicians are mixed on the short-term outlook for the USD/JPY. Some are lined up with the logicians and calling for a resumption in the macro uptrend. Others are still calling for a move down to the 92.50 – 92.60 range before resuming the macro uptrend. Short-term resistance comes in at 98.75 (Fibonacci projection) and is followed by the 8/1 close at 99.54. Short-term support comes in at 97.06 and is followed up by 96.00 - both of which are horizontal lines of support.