On the daily USD/JPY chart, the price went above the price channel line yesterday, but could not gain a foothold due to the unexpected “crash” of the ISM Manufacturing PMI US index, which fell from 49.1 to 47.8 in September against expectations of growth to 50.4. The fall in the index sharply raises the importance of today’s ADP Non-Farm Employment Change – a change in the number of jobs in the US private sector today and Friday’s Nonfarm payrolls data; the forecast for the ADP index is 140 thousand against 195 thousand a month earlier, for Nonfarm 140 thousand against 130 thousand in August. The output of the data, no worse than expected, can mitigate the failure of the Manufacturing PMI and keep tension in the market until the Federal Reserve meeting at the end of the month. Weak labor data will raise expectations for the October rate cut and could weaken the dollar even more.
So, today we are waiting for the release of data on ADP Non-Farm Employment Change for September. Strong data will make it possible for the price to go above the resistance of the trend line at 108.22. So far, we are supporters of positive scenarios in the US economy.
On the four-hour chart, the price is below the MACD line, but above the balance line and is visually preparing to go above these lines. The Marlin oscillator in the negative zone, but also tends to move into the growth zone.
The failure of US data will push the price to support green price channel (107.28), and then likely drop to the MACD line on the daily scale price 106.62.
The material has been provided by InstaForex Company – www.instaforex.com