Current trend

The USD/JPY pair is showing mixed trading, holding close to 143.15.

The day before, weak data on the dynamics of Gross Domestic Product (GDP) exerted noticeable pressure on the yen’s position: the indicator in the second quarter slowed down from 0.8% to 0.7% with neutral forecasts, and in annual terms — from 3.1% to 2.9% with preliminary estimates of 3.2%. At the same time, the Gross Domestic Product Deflator rose from 3.0% to 3.2%. The economy as a whole has been in a state of stagnation since the second half of 2023, although it recovered in April-June. The capital spending component of GDP, a proxy for private demand, added 0.8% in the second quarter, versus expectations of 1.0%, while private consumption, which accounts for more than half of the Japanese economy, rose 0.9%, versus a preliminary reading of 1.0%. However, the revised GDP data is unlikely to have much impact on the Bank of Japan's decision-making now. In July, the regulator raised the interest rate to 0.25% from 0.10%.

American investors, in turn, are assessing the August report on the labor market published last Friday, which reflected the creation of 142.0 thousand new jobs outside the agricultural sector, which was worse than the forecast of 160.0 thousand. At the same time, markets took note of the revision of July values from the previous 114.0 thousand to 89.0 thousand. Average Hourly Earnings accelerated from 3.6% to 3.8% year-on-year, ahead of analysts' expectations of 3.7%, and from 0.2% to 0.4% month-on-month, also beating forecasts of 0.3%. The Unemployment Rate, as expected, fell from 4.3% to 4.2%.

This week, the US will release data on consumer and producer inflation for August, which could influence the monetary authorities' decision at their meeting on September 18.

Support and resistance

Bollinger Bands on the daily chart show a steady decline. The price range changes slightly, making way for new local lows for the "bears". MACD is trying to reverse into an ascending plane again keeping its previous sell signal (located below the signal line). Stochastic is showing similar dynamics, leaving the oversold area with a signal in favor of the development of a full-fledged upward trend in the ultra-short term.

Resistance levels: 143.35, 144.00, 145.00, 146.00.

Support levels: 142.50, 141.76, 141.00, 140.00.

Trading tips

Long positions can be opened after a breakout of 144.00 with the target of 146.00. Stop-loss — 143.00. Implementation time: 2-3 days.

The return of a "bearish" trend with the breakdown of 142.50 may become a signal for new short positions with the target at 141.00. Stop-loss — 143.35.