#USDJPY @ 129.996 rallies around 150 pips in reaction to the mostly upbeat US employment details. (Pivot Orderbook analysis)

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• USD/JPY rallies around 150 pips in reaction to the mostly upbeat US employment details.
• The US economy added 517K new jobs in January and the jobless rate dropped to 3.4%.
• A weaker risk tone, hawkish BoJ expectations could lend support to the JPY and cap gains.

The pair currently trades last at 129.996.

The previous day high was 129.13 while the previous day low was 128.08. The daily 38.2% Fib levels comes at 128.49, expected to provide support. Similarly, the daily 61.8% fib level is at 128.73, expected to provide support.

The USD/JPY pair catches some bids during the early North American session and spikes to a fresh daily top, around the 129.80 region in reaction to the mostly upbeat US employment details.

In fact, the headline NFP print showed that the US economy added 517K jobs in January, surpassing even the most optimistic estimates. Adding to this, the unemployment rate unexpectedly edged down to 3.4% during the reported month from 3.5% in December. The data further points to the underlying strength in the US labor market, which should allow the Fed to stick to its hawkish stance. This, in turn, provides a strong boost to the US Dollar and is seen as a key factor behind the USD/JPY pair’s sharp rally of around 150 pips in the last hour.

That said, a combination of factors lends some support to the Japanese Yen (JPY) and fails to assist spot prices to build on the momentum beyond the 200-hour SMA. Diminishing odds for an imminent pause o the Fed’s rate-hiking cycle take a toll on the global risk sentiment, which is evident from a weaker tone around the equity markets. This, along with speculations that high inflation may invite a more hawkish stance from the Bank of Japan (BoJ) later this year, underpins the safe-haven JPY and keeps a lid on any further gains for the USD/JPY pair.

Hence, it will be prudent to wait for strong follow-through buying before positioning for an extension of the intraday positive move. Nevertheless, the USD/JPY pair, for now, seems to have erased its modest weekly losses and remains at the mercy of the USD price dynamics.

Technical Levels: Supports and Resistances

USDJPY currently trading at 128.52 at the time of writing. Pair opened at 128.75 and is trading with a change of -0.18 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 129.91, 50 SMA 132.97, 100 SMA @ 138.9 and 200 SMA @ 136.78.

The previous day high was 129.13 while the previous day low was 128.08. The daily 38.2% Fib levels comes at 128.49, expected to provide support. Similarly, the daily 61.8% fib level is at 128.73, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 128.18, 127.61, 127.13
• Pivot resistance is noted at 129.23, 129.71, 130.28

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