The USDJPY pair erased all the daily losses and was trading 0.10% stronger during the London session, hovering near 107.50.
Earlier in the night, Trump ordered the US Trade Representative to consider doubling the amount of Chinese import tariffs to 100 billion USD – or from 50 billion USD to 150 billion USD. New tariffs sent stocks lower, although not so much as in the previous days and also caused some selling of the USDJPY pair. However, the dip here was quickly bought.
Markets will now focus on today’s US labor market data, with the non-farm employment change expected to slow notably to 188,000 from 313,000 in February. The unemployment rate is forecast to improve to 4.0%. Investors are also expecting a pick up in wage growth, which could be dollar positive.
In addition, the Fed Chair Powel is due to speak about the economic outlook at the Economic Club of Chicago. This could bring another wave of volatility.
The USDJPY pair managed to climb above the bearish trendline, which is slightly positive. The next resistance is in the 107.60 – 107.90 area and if not held, further rise toward 108.50 could occur.
On the other hand, the support is seen at the 107 level and if broken, bears could push the pair back toward the bearish trendline at 106.50. In all cases we strongly recommend to have rigorous money and risk management.
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