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Japanese Yen consolidates previous session's gains, US NFP propelled hawkish Fed bets buoy dollar

Chart - Courtesy Trading View

USD/JPY was trading 0.18% higher on the day at 135.28 at around 04:15 GMT.

The pair is extending previous session's gains, US dollar remains buoyed after stellar jobs data.

Data released on Friday last week showed US headline NFP print smashed consensus estimates to add a whopping 528K jobs in July, more than doubling forecasts at 250K.

Furthermore, the unemployment rate surprisingly fell to a pre-pandemic low of 3.5% from 3.6% in June.

The stellar employment report stokes bets for a larger interest rate hike at the September FOMC policy meeting.

The odds for a 75 bps hike have jumped to 61% from the 40% before the release.US Treasury bond yields spiked 14 basis points (bps) to 2.83% and eased back to 2.82 on the day.

Looking forward, focus will be on US inflation data, scheduled for publishing on Wednesday.

Technical Analysis:

- USD/JPY has bounced off daily cloud support

- Momentum has turned bullish, Stochs and RSI are biased higher

- Price action has edged above 21-EMA and is above 200H MA

- GMMA indicator shows major and minor trend are bullish on the intraday charts

Major Support Levels: 134.01 (5-DMA), 133.86 (200H MA)

Major Resistance Levels: 135.93 (20-DMA), 136

Summary: USD/JPY trades with a bullish bias. Scope for further upside. Weakness only below daily cloud.

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