GBP/USD stabilises while USD/JPY and EUR/JPY slip after strong US jobs data and Japan inflation
Outlook on GBP/USD, USD/JPY and EUR/JPY amid much-stronger-than expected US ADP jobs data ahead of Friday’s Non-Farm Payrolls report.
GBP/USD continues to range trade
As rate hike expectations on both side of the Atlantic have risen amid much stronger-than-expected US ADP jobs data ahead of today’s US Non-Farm Payrolls, GBP/USD essentially remains side-lined, even though it spiked to $1.2781 on Thursday before coming off again.
While Thursday’s low at $1.2674 underpins, a short-term upside bias should remain intact.
Minor support above this level can be seen around the 23 June low at $1.2687.
USD/JPY slips on inflationary pressures
As Japan is showing signs of inflation with wage growth in May coming in much higher than expected at 2.5% Year-on-Year (YoY) versus an expected 1.2%, USD/JPY slid back towards its May-to-July uptrend line at ¥143.14 ahead of today’s US Non-Farm Payrolls data release.
If slid through, the 21 June high at ¥142.36 would be back in the picture.
Minor resistance can be spotted at the ¥143.99 early-July low.
EUR/JPY drops further
EUR/JPY rise seems to have fizzled out at the late June high at ¥158.00 as traders are increasingly concerned about potential currency intervention by the Bank of Japan (BoJ) and as wage inflation unexpectedly rose by twice of what was expected in May.
A slip back to this week’s low at ¥155.85 is at hand, a fall through which would target the mid-June high at ¥155.33 and the 23 June low at ¥155.06.
Minor resistance can be spotted at the late June low at ¥156.69 and at Thursday’s intraday high at ¥156.91. While it caps, downside pressure should retain the upper hand.
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