USD/JPY is expected to trade with bearish bias. The pair remains under pressure below its key resistance at 103.50, and is likely to test its nearest support levels at 102.80 and 102.55 in the coming sessions. The intraday trend remains bearish, as the falling 50-period moving average maintains the strong selling pressure on the prices.
On Thursday, U.S. stocks ended another session in negative territory. The S&P 500 dropped 9 points (-0.4%) to 2,088 making up an eight-day losing streak, the longest since 2008. The Dow Jones Industrial Average declined 28 points (-0.2%) to 17,930, and the Nasdaq Composite was down 47 points (-0.9%) to 5,058.
On the economic data front, the U.S. Labor Department reported that initial jobless claims amounted to 265,000 in the week ended October 29, higher than 256,000 expected. The ISM Non-manufacturing PMI declined to 54.8 in October (vs. 56.0 expected) from 57.1 in September, while the Markit US services PMI in October improved to 54.8 from 52.3 in September. Factory orders grew 0.3% on month in September (vs. +0.2% expected, +0.4% in August), while durable goods orders fell 0.3% on month (vs. -0.1% expected, +0.3% in August).
To look for further evidence that the U.S. Federal Reserve would raise interest rates in December, investors are watching closely today's October jobs report, which is expected to post an addition of 173,000 jobs with a lower jobless rate of 4.9%.
To conclude, as long as 103.50 is not surpassed, look for a test of 102.55 as likely.
Trading Recommendation: The pair is trading below its pivot point. It is likely to trade in a lower range as long as it remains below the pivot point. Short positions are recommended with the first target at 102.55. A break below this target will move the pair further downwards to 102.20. The pivot point stands at 103.50. In case the price moves in the opposite direction and bounces back from the support level, it will move above its pivot point. It is likely to move further to the upside. According to that scenario, long positions are recommended with the first target at 103.90 and the second one at 104.40.
Resistance levels: 103.90, 104.40, 105.00
Support levels: 102.55, 102.20, 102.00
The material has been provided by InstaForex Company - www.instaforex.comFrom www.instaforex.com http://ift.tt/2ekVrLP
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