USD/JPY Price Consolidating Above 128.5 Ahead of US NFP Data

• The USD/JPY pair could drop deeper after escaping from the triangle pattern.
• A new lower low activates more declines.
• The US data should move the rate later today.

The USD/JPY price seems undecided as the traders wait for US data before taking action again. The pair is trading at 128.68, above yesterday’s low of 128.08.

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The price moved sideways as the DXY and Japanese Yen Futures rallied. Yesterday, the ECB and BOE represented high-impact events but didn’t impact the USD/JPY pair.

In the short term, the price dropped as the US reported some poor data lately. The CB Consumer Confidence, ISM Manufacturing PMI, ADP Non-Farm Employment Change, and Chicago PMI were worse than expected. The FOMC also weakened the USD. Still, today, the US data should take the lead and move the rate. Better-than-expected figures should lift the greenback, while downbeat data could force the price to approach new lows.

The US Non-Farm Payrolls are expected at 193K in January versus 223K in the previous reporting period. Average Hourly Earnings may announce a 0.3% growth, while ISM Services PMI could jump into the expansion territory again, from 49.6 to 50.5 points. Still, the predictions show that the Unemployment Rate should increase from 3.5% to 3.6%.

USD/JPY price technical analysis: Attracting more sellers

The USD/JPY pair is technically trapped between the 129.13 and 128.17 levels. Escaping from the major triangle signaled a potential downside movement.

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Still, a new lower low and making a valid breakdown below 128.17 could trigger more declines. Now, it seems undecided, so only a valid breakout from this minor range pattern could bring new opportunities.

The pair has failed to stay below the descending pitchfork’s median line (ml), signaling exhausted sellers in the short term. From the technical point of view, the USD/JPY pair could still resume its downside movement as long as it stays within the pitchfork’s body. A deeper drop could be invalidated if the price makes a valid breakout above 129.13.

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