The American currency gains ground, supported by strong ISM Services PMI report.
At the start of the week, USD/JPY is once again showing notable buying pressure. Over the last few trading sessions, the pair.
USD/JPY bulls are back. After last week's intervention scare briefly knocked the pair lower, Yen selling returned today as the most obvious window for Japanese action passed without official intervention.
USDJPY managed to pass above the short-term resistance zone of 161.95 which shows a strong advance still ongoing. Prices fell toward 160.50-70 on the suspected intervention before bouncing back.
Strong rise in early Monday trading is about to fully reverse last week's 162.84/160.47 pullback, which marked a healthy correction (contained by Fibo 23.6% of 155.02/162.84 upleg) of larger uptrend.
USD/JPY was the main focus for many traders last week, moving above 162 as markets tested the Japanese government's willingness to intervene. Intervention warnings from Japanese officials, together with rumors that intervention may have started, triggered a quick retracement, although actual intervention was not confirmed.
Thursday's abrupt decline in USD/JPY reignited speculation that the Bank of Japan may have stepped into the market on behalf of Japan's Ministry of Finance. Whether that was the case remains unclear, but it's plausible the move reflected a combination of other factors, including a well-timed Reuters report suggesting Japanese authorities may be looking to catch speculators off guard, heavily stretched short yen positioning, thinning liquidity ahead of the US payrolls report and Independence Day holiday, and Federal Reserve Chair Kevin Warsh striking a slightly less hawkish tone only hours earlier.
The American currency moved away from session lows in holiday-thinned trading session.
The latest US employment figures have taken some of the shine off the dollar, yet the report falls short of signalling a decisive shift in the long-dollar narrative. The Fed's policy outlook still favours a rate hike later this year, although much will depend on the direction of inflation.
USD/JPY Price Forecast: Seems vulnerable near two-week low, below 23.6% Fibo. at 161.00
Looking at the 4-hour chart, the pair declined below the 162.00 and 161.20 support levels. There was a clear move below the 50% Fib retracement level of the upward move from the 159.54 swing low to the 162.84 high.
The Japanese yen jumped sharply on Thursday as traders braced for a potential intervention by the Bank of Japan (BoJ). The USD/JPY pair retreated to a low of 160.62 from the year-to-date high of 162.84.