FxWirePro: USD/JPY bounces off session lows, yen weakens after BoJ status quo, NFP crucial for further direction

Chart - Courtesy Trading View 

USD/JPY was trading 0.23% higher on the day at 136.44 at around 03:20 GMT, slightly lower from session highs at 136.97.

The yen weakened after the Bank of Japan’s (BoJ) inaction during early Friday, Comments from incoming BoJ Governor Ueda will be watched for further cues.

BoJ kept the short-term interest rate target at -0.1% while directing 10-year Japanese Government Bond (JGB) yields within the band of +/-0.50%. 

However, the statement that followed stated that inflationary expectations are rising, which in turn raises doubts about the future of the bank’s ultra-easy monetary policy.

Data from US on Thursday showed Initial Jobless Claims marked the biggest jump since January by rising to 211K for the week ended on March 03 versus 195K expected and 190K prior.

Focus now turns to the key nonfarm payrolls report later on Friday, for clues on the Fed's next steps for monetary policy.

Markets expect US nonfarm payrolls likely increased by 205,000 jobs in February after surging by 517,000 in January.

Major Support Levels: 135.16 (nearly converged 21 and 110 EMAs), 134.34 (55-EMA)

Major Resistance Levels: 136.60 (5-DMA), 137.47 (200-DMA)

Summary: USD/JPY technical bias remains bearish as long as pair remains below 200-DMA. Strong support seen at 135.16, break below will see more weakness. Bullishness only above 200-DMA.