- USD/JPY is rising for the fourth straight day on Friday.
- US Dollar Index rebounds toward 97.00 following the weekly slump.
- Investors wait for May Nonfarm Payrolls data from the US.
The USD/JPY pair closed the last three days of the week in the positive territory and gained more than 150 pips during that period. With the trading action in the FX markets turning subdued ahead of key macroeconomic data releases from the US, the pair is posting modest daily gains near 109.20. Earlier in the day, USD/JPY touched its highest level since late March at 109.43 but struggled to preserve its momentum.
Despite the heavy selling pressure surrounding the greenback, the unabated risk-on flows didn’t allow the JPY to gather strength. On Friday, major European equity indexes are gaining between 0.9% and 1.8% to show that the market mood remains upbeat.
Focus shifts to US NFP data
In the early trading hours of the American session, the Nonfarm Payrolls (NFP) report from the US will be watched closely by the market participants. Ahead of this data, the US Dollar Index (DXY) is up 0.07% on the day at 96.83. Nevertheless, USD/JPY’s movements are likely to be impacted by Wall Street’s reaction to the data rather than the DXY.
Previewing the data, “we have pencilled in an employment drop of 10 million but given the ‘strong’ private sector ADP jobs report earlier this week, which ‘only’ showed a drop of 2.7 million, we may be too pessimistic,” said Danske Bank analysts.
US NFP Preview: Ten major banks expectations for May jobs report.
Technical levels to watch for
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