FxWirePro: USD/JPY comatose at 200-DMA support, break below to see more weakness

Chart - Courtesy Trading View 

Spot Analysis:

USD/JPY was trading 0.57% higher on the day at 135.08 at around 07:15 GMT.

Previous Week's High/ Low: 133.61/ 139.89

Previous Session's High/ Low: 133.61/ 135.98

Fundamental Overview:

Nonfarm Payrolls rose by 263K in November, the smallest since April 2021, but data still beat expectations and showed positive signs about the health of the labor market.

US monthly jobs report released on Friday validates the view that the Fed will continue to tighten its monetary policy, although at a slower pace.

Markets are turning cautious ahead of the US Services PMI data. Analysts expect a 55.6 print, lower than the prior release of 54.4. The New Orders Index is seen at 58.5 against 56.5 prior.

On the other side, Bank of Japan (BOJ) Governor Haruhiko Kuroda highlighted the risk of a slowdown in inflation from CY2023. 

Slowing inflation may propel the BOJ to maintain easy policy in order to keep inflation near the targeted rate of 2%. 

Going forward, focus will be on Japan Overall Household Spending which is expected to improve to 3.4% from the prior release of 2.3% on an annual basis.

Technical Analysis:

- Momentum is bearish, volatility is high

- GMMA indicator shows major and minor trend are bearish

- MACD and ADX support downside in the pair

- Strong support seen at 200-DMA, break below will plummet prices

Major Support and Resistance Levels:

Support - 134.59 (200-DMA), Resistance - 136.27 (5-DMA)

Summary: USD/JPY trades with a bearish bias. Watch out for break below 200-DMA for further weakness.