FxWirePro: USD/JPY depressed below 21-EMA, Friday’s mixed NFP report and risk-on-impulse drag

Chart - Courtesy Trading View 

Spot Analysis:

USD/JPY was trading slightly weaker below 21-EMA, poised for further downside.

Previous Week's High/ Low: 148.84/ 145.66

Previous Session's High/ Low: 148.40/ 146.55

Fundamental Overview:

Friday’s US jobs report, showed a jump in the headlines Nonfarm Payrolls (NFP) and an increase in the Unemployment Rate.

Mixed Nonfarm Payrolls report joined fears of Fed policy pivot to weigh on the US dollar, dragging the pair lower. 

Of major significance later this week will be US Consumer Price Index (CPI) data due Thursday, which will determine whether the Fed will increase the peak for terminal rates or will leave them unchanged.

Preliminary estimates suggest the headline CPI is likely to slip lower to 8.0% vs. the prior release of 8.2%. While the core CPI that excludes oil and food prices is seen lower at 6.5% against 6.6% recorded earlier.

Technical Analysis:

- GMMA indicator shows major trend is bullish, while minor trend is neutral

- Momentum is bearish, Stochs and RSI are biased lower, RSI has slipped below 50 mark

- MACD and ADX support further downside in the pair

- Bearish RSI divergence keep scope for weakness in the pair

Major Support and Resistance Levels:

Support - 144.36 (55-EMA), Resistance - 147.89 (20-DMA)

Summary: USD/JPY trades directionless at 21-EMA support, decisive break below will see more downside. US Consumer Price Index (CPI) data will be the key to further price action.