Despite Strong U.S. Employment Data, Caution Advised Regarding Further Downside Potential for the U.S. Dollar Against the Yen

Despite Strong U.S. Employment Data, Caution Advised Regarding Further Downside Potential for the U.S. Dollar Against the Yen

13.01.2025

Last weekend, the U.S. dollar rose immediately following the release of the U.S. December employment report on the 10th, as the unemployment rate fell from 4.2% the previous month to 4.1% and nonfarm payrolls came in at 256,000, exceeding market expectations of 164,000.The USD/JPY pair rose from 157.622 to 158.871. However, the momentum failed to hold, and the pair subsequently fell back to 157.231. Since the daily chart shows two consecutive days of decline, caution is warranted regarding price movements during today’s U.S. trading hours.

Among European currencies, the pound was the weakest during U.S. trading hours. The GBP/USD pair fell from 1.2320 to 1.2192. The decline continued as the pair faced resistance at the 20-period moving average on the hourly chart. On the 4-hour chart, the candlesticks have reached the -3σ level of the Bollinger Bands, and similar price action is observed on the daily chart. We will be closely monitoring price movements during European trading hours to see if the pound continues to weaken against the U.S. dollar.

Today’s economic indicators include New Zealand housing permits at 6:45, China’s trade balance at 11:00, Sweden’s expected price trends at 14:30, Turkey’s current account balance at 16:00, the Czech Republic’s retail sales at 17:00, the Czech Republic’s current account balance at 18:00,India’s Consumer Price Index at 7:30 PM, Canada’s Leading Economic Index at 8:00 PM, the Philippines’ Current Account Balance at 10:00 PM, the U.S. Employment Trends Index at midnight, the U.S. 6-month Treasury bill auction at 1:30 AM, and the U.S. Budget Balance at 4:00 AM. Despite strong U.S. employment data, the dollar has fallen against the yen, so we must remain highly vigilant regarding the downside potential.

Past Market Reports

1. 17.04.2026New

   Will the market wait and see how much further the U.S. dollar can rise against the yen?

2. 16.04.2026New

   Will the weakening Swiss franc recover? Attention is turning to price movements during European trading hours.

3. 15.04.2026New

   Market participants are likely keeping a close eye on the upside potential of the euro, which has risen against the U.S. dollar

4. 14.04.2026New

   Should we keep an eye on remarks by key figures in the U.S. and try to gauge the direction of currency strength?

5. 13.04.2026New

   Market participants are likely watching for signs of a rebound in the Canadian dollar, which fell against the U.S. dollar following the release of employment figures

6. 10.04.2026

   Will the weakening Swiss franc continue to strengthen against the yen, or should we wait and see?

7. 09.04.2026

   Will the U.S. dollar, which has fallen against the yen, continue its downward slide, or should we wait and see how the market moves?

8. 08.04.2026

   Should we keep an eye on the upside for European currencies that have risen against the U.S. dollar?

9. 07.04.2026

   Market participants may be wary of further downside potential for the U.S. dollar, which has weakened amid concerns over the situation in Iran

10. 06.04.2026

    Investors should be wary of sudden spikes in volatility while major markets are closed