USD/JPY Forecast May 11-15 – Yen Yawns as U.S. Job Numbers Sink

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Dollar/yen was almost unchanged last week. Investors will be keeping an eye on the BoJ minutes from the last policy meeting. In the U.S., it’s a busy week ahead, with the release of consumer inflation, jobless claims and retail sales.
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USD/JPY fundamental mover

An extended bank holiday in Japan led to an uneventful week for USD/JPY. Household spending declined by 6.0% in March from a year earlier, its sharpest fall since 2015.

In the U.S., factory orders fell by 10.3% in March, after a flat 0.0% reading a month earlier. Employment numbers for April were dismal. Unemployment claims came in at 3.16 million, down from 3.8 million a week earlier. This brings the running total to a staggering 33.4 million. Nonfarm payrolls dropped by a record 20.5 million in April, slightly below the estimate of 22.4 million. The unemployment rate jumped to 14.7%, up from 4.4% a month earlier. Still, this beat the forecast of 16.0 percent. There was some good news, as wage growth shot up 4.7%, crushing the estimate of 0.5 percent.
See all the main events in the Forex Weekly Outlook

Key news updates for USD/JPY

Updates:

USD/JPY Technical Analysis

We start with resistance at 110.62.

109.73 is protecting the 110 level, which has psychological significance.

108.70 (mentioned last week) is next.

108.10 has held in resistance since mid-March.

107.30 is next.

106.61 is fluid, as the pair ended the week on this line.

105.55 is providing support.

104.65 has held in support since early March.

102.50 is the final support line for now.

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USD/JPY Daily Chart

USD/JPY Sentiment

I am neutral on USD/JPY

The Japanese yen is considered a reliable safe-haven assets in times of trouble, but investors haven’t given it more preference than the U.S. dollar. USD/JPY has been steady in recent weeks, and this trend could continue in the upcoming week.

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About Author

Kenny Fisher - Senior Writer A native of Toronto, Canada, Kenneth worked for seven years in the marketing and trading departments at Bendix, a foreign exchange company in Toronto. Kenneth is also a lawyer, and has extensive experience as an editor and writer.