Fundamental view:

The US dollar showed a bullish trend against the yen during the trading course of the week. The pair seemed to react to the bond taper despite of the huge miss in the US September Nonfarm Payrolls. The US economy has made a gain of just 194,000 jobs in September which is far worse than expectation of 500K. The August result was revised up to 366,000 from 235,000. The two month total of 429,000 is less than one-quarter of the more than two million hires in June and July. On the other hand, Treasury rates have been rising since the last Federal Reserve meeting on September 22. 

US Factory Orders monthly report on 4th Oct and US Participation Rate on 8th Oct created bearish trend whereas Japan BoJ Monetary Base yearly report on 4th Oct and US Initial Jobless Claims on 7th Oct created bullish trend for the pair.

The major economic events deciding the movement of the pair in the next week are BoJ Corporate Goods Price Index monthly report, US JOLTS Job Openings at Oct 12, FOMC Minutes at Oct 13, Japan Industrial Production monthly report, US Initial Jobless Claims, US EIA Crude Oil Stocks Change at Oct 14, Japan Tertiary Industry Activity Index monthly report and US Retail Sales monthly report at Oct 15.  

USD/JPY Weekly outlook:

Technical View:

Last week’s high was 0.16% higher than the previous week. Maintaining high at 112.25 and low at 110.82 showed a movement of 143 pips.

In the upcoming week we expect USD/JPY to show a bullish trend. The currency pair is trading above the 200 Simple Moving Average and the MACD trades to the upside. A solid breakout above 112.71 may open a clean path towards 113.20 and may take a way up to 114.14. Should 111.28 prove to be unreliable support, the USDJPY may sink downwards 110.34 and 109.85 respectively. In H4 chart, Formation of cup and handle pattern indicates reversal of the trend creating prospects of a bullish trend Along with a bullish hammer formation braces our expectation.