USD/JPY: downside playing out on risk-off

By FXStreet FXStreet (Guatemala) – USD/JPY is oscillating around 119.00 having made a minor recovery from the early Asian lows of 118.93 in a risk-off environment post the Nonfarm Payrolls.

USD/JPY posted a low of 118.58 on mixed Nonfarm Payrolls release. The headline number missed expectations, but the meat on the bone came from a drop in the unemployment rate to 5.1%, which is within a band of where the Fed regards as full employment and this was accompanied by a revision to the July report of +44k that also had a reduction of the unemployment rate.

This leaves this month’s FOMC open to the risk of an interest rate hike from the Fed, that would otherwise be dollar supportive, but the Yen is favoured on risk aversion and bearish global stock market performances. We are less busy on the US calendar this week, and the US is out for labour day, but we do have China returning after a 4-session break. China will be key this week and they will report CPI as well as the PBOC reserves from August.

USD/JPY downside compelling

Technically, 118.33/25 and March low is in sight which guards the 116.15/115.85 2015 low and the recent …read more

Source:: FX Street