USDJPY on Friday dropped -0.35% to 152.62. Week ending 2024-11-08 rose 0.22%. What happened.

USDJPY Analysis

Performance
Period	Pct	Chg	Momentum
Friday	-0.35%	-53.901 Pips
Week 242024-11-08	0.22%	33.2 Pips
November	0.42%	63.9 Pips

Upcoming key events for the new week (London Time)

Mon 05:00 AM Veterans Day
Wed 01:30 PM CPI Inflation Rate (12-mth)
Thu 01:30 PM Initial Unemployment Insurance Claims
Thu 01:30 PM PPI excluding Food and Energy sectors (12-mth)
Thu 08:00 PM Federal Reserve Chair Jerome Powell speech
Thu 11:50 PM GDP (3-mth)
Fri 01:30 PM Monthly Retail Trade (1-mth)

What happened over the week

In the United States, several economic indicators have been reported reflecting mixed economic conditions. The University of Michigan reported an increase in the consumer sentiment index to 73 points in November, indicating improved consumer confidence. However, the Federal Reserve announced a decrease in the federal funds rate to 4.75%, suggesting a potential easing of monetary policy. According to the Bureau of Labor Statistics, unit labor costs in Q3 saw a drop to 2.4%, from an initial 0.4% estimate, indicating cooling wage pressure. The Department of Labor reported an increase in initial unemployment claims to 221,000, slightly above the revised figure of 218,000, possibly signaling early labor market strains. Nonfarm business labor productivity saw a slight decline to 2.2% in Q3 compared to 2.5% in Q2. Additionally, the Census Bureau noted an improvement in new orders for manufactured goods, rising to -0.5% in September from a revised -0.8% in August. In a political development, Donald Trump secured a win over Harris, becoming the 47th president of the United States, an event that often triggers market reactions.

In Japan, the Ministry of Health, Labour and Welfare reported a decline in total cash earnings growth to 2.8% for September, from 3% in August. This decrease may reflect slowing wage growth and potential pressure on household incomes.

The USDJPY exchange rate is influenced by these economic and political events. The rate saw fluctuations, hitting a 14-week high following Donald Trump’s election victory, reflecting market expectations of his economic policies. However, the rate subsequently dropped by 0.35% to 152.62000. The reduced federal funds rate could lead to a weaker USD, potentially impacting USDJPY negatively. Conversely, improving U.S. consumer sentiment could bolster investor confidence, potentially strengthening the USD. Upcoming high-impact events including, U.S. CPI Inflation Rate and Federal Reserve Chair Jerome Powell’s speech, alongside Japanese GDP data, are likely to further influence USDJPY volatility and directional trends.

From social media

Minutes of the Monetary Policy Meeting on September 19 and 20, 2024 https://t.co/5W3JOrZWbh

— Bank of Japan (@Bank_of_Japan_e) November 5, 2024

What can we expect from USDJPY for the new week and what happened on Friday?

USDJPY on Friday dropped -0.35% to 152.62. Price is below 9-Day EMA while Stochastic is rising. For the week ending ,2024-11-08, the pair rose 0.22% or 33.2 pips higher.

Looking ahead, USDJPY looks bearish as the pair posted lower in Friday trading session.

For the new week, our technical outlook is mixed. To see upside interest, we prefer to look at price breakout of week high of 154.70 or at least consolidates above Weekly Pivot level of 152.89. On the downside, we are looking at week low 151.34 or 151.07 (WS1) as immediate support level. USDJPY need to break on either side to indicate a short-term bias. A break above 154.70 would suggest bullish bias after recent positive movement.

For the month of November, USDJPY is up by 0.42% or 63.9 pips higher.

Weekly key levels to watch out:

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Monthly Wholesale Trade: Sales and Inventories Source: Census Bureau
Trade Statistics (First 20 Days of October 2024 [Provisional]) Source: Ministry of Finance
Federal Reserve issues FOMC statement Source: Federal Reserve
Minutes of the Monetary Policy Meeting on September 19 and 20, 2024 Source: Bank of Japan
U.S. International Trade in Goods and Services, September 2024 Source: Bureau of Economic Analysis
U.S. International Trade in Goods and Services Source: Census Bureau
Manufacturers’ Shipments, Inventories, and Orders Source: Census Bureau