USD/JPY: Trading the US jobless claims Nov 2014

US Unemployment Claims, a key indicator, is released weekly. It measures the number of people who filed for unemployment for the first time during the previous week. A reading which is higher than the market forecast is bullish for the Japanese yen.

Update:  US jobless claims rise to 290K

Here are all the details, and 5 possible outcomes for USD/JPY.

Published on Thursday at 13:30 GMT.

Indicator Background

Employment  numbers are closely monitored by the markets, and unemployment claims should be treated as a market-mover which can have a strong impact on the movement of USD/JPY.

Unemployment claims have looked solid in recent readings. The indicator slipped to 278 thousand, beating the estimate of 285 thousand. The estimate for the upcoming reading  stands at 282 thousand.

Sentiments and levels

Now that  QE is finally behind us, the focus shifts to an interest rate hike. The US economy continues to improve and wages could move upwards, which will put pressure on the Fed to raise interest rates. With the BoJ raising stimulus earlier in the month, the wobbly yen could fall even further. So, the sentiment is  bullish on USD/JPY towards this release.

Technical levels, from top to bottom: 119.88, 117.94, 116.66, 114.65,  113.68 and 112.48.

5 Scenarios

1. Within expectations: 279K to 285K: In such a case, USD/JPY is likely to rise within range, with a small chance of breaking higher.
2. Above expectations: 286K to 294K: An unexpected  higher  number of claims  can send the pair  below one  support line.
3. Well above expectations: Above 294K:  Weak employment numbers  could push USD/JPY downwards, and two or more support lines might be broken on such an outcome.
4. Below expectations: 270K to 278K: A  strong reading  could push USD/JPY higher, and one resistance line could be broken.
5. Well below expectations: Below 270K. In this scenario, the pair could break  through two or more lines of resistance.

For more on the yen, see the USD/JPY forecast.

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