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It’s U.S. non-farm payrolls (NFP) day and that’s no joke!

Take a look at USD/JPY’s 4-hour chart and see if you can spot opportunities ahead of the data release.

Before moving on, ICYMI, yesterday’s watchlist checked out USD/CAD’s downtrend as markets focused on crude oil price action. Be sure to check out if it’s still a valid play!

And now for the headlines that rocked the markets in the last trading sessions:

Fresh Market Headlines & Economic Data:

Canada’s economy eked out 0.2% growth to start 2022, despite Omicron

U.S. core PCE continues up by 5.4% YoY vs 5.2% YoY in January; puts more pressure on Fed

Weekly U.S. jobless claims reach record 202,000 after falling to lowest level since Dec 1969

Australia manufacturing index improves from 48.4 to 53.2 in February

Asian shares slip as Japan ‘tankan’ shows weaker outlook

Caixin’s China manufacturing PMI slumps at fastest pace in over two years in March amid Covid-19

World stocks dip on war, recession worries, oil falls $2 on reserve release

Upcoming Potential Catalysts on the Forex Economic Calendar:

U.S. NFP reports at 12:30 pm GMT
U.S. unemployment rate at 12:30 pm GMT
Canada’s manufacturing PMI at 1:30 pm GMT
U.S. ISM manufacturing PMI at 2:00 pm GMT

Use our new Currency Heat Map to quickly see a visual overview of the forex market’s price action! 🔥 🗺️

What to Watch: USD/JPY

USD/JPY 4-hour Forex Chart

USD/JPY 4-hour Forex Chart

USD/JPY’s March rally came to a halt at $125.00 earlier this week thanks to a combo of risk aversion, dollar weakness, and Japan’s end-of-year currency moves.

Now that Japanese taxpayers and businesses have closed their books, will traders be more confident in extending USD/JPY’s uptrend?

The pair’s 4-hour chart tells us that there were not enough sellers to complete a downside breakout of a Head and Shoulders pattern. The 121.50 “neckline” turned into a support zone and now USD is trading closer to $123.00.

Today’s U.S. NFP report could give us clues on the strength of USD/JPY’s uptrend. Markets are pricing in a net increase of 492K jobs in March, with improvements in the jobless rate and the average hourly earnings data.

Better-than-expected results would support the Fed’s aggressive tightening schedule and encourage risk-taking in the markets. USD/JPY could revisit its March highs before seeing another round of selling.

But if the reports significantly miss market expectations, then USD/JPY could give up some of its gains from the previous sessions and revisit the 121.50 support levels.

Planning on trading the pair during or after the NFP release? Make sure you know all about USD/JPY’s average daily volatility so you’ll have some idea on where to place your entry and exit points!