The jobs report is impressive but does it matter
The USDJPY moved from 105.08 just before the report, to a post jobs report high of 105.42 after the impressive jobs numbers. However, the price is still down some 90 pips or so on the day. Looking at the 5-minute chart, the 100 bar MA comes in at 105.527. The price of the pair has spent the vast majority of the last two days below that MA line. For today, it will take a move above that MA (and stay above) for the momentum to even begin to show some signs of rebounding. Until then, the sellers remain in full control.
Taking a longer term look at the daily chart, the one bright spot for dip buyers is that the swing area between 104.87 and 105.047 stalled the fall. The 104.87 was the low going back to January 2018. The 105.047 were lows going back to August 2019. There was a lower low in August down to 104.438, and that would be a target on a break of the 104.87 level. We may see buyers in that yellow area as risk can be defined and limited, but I would expect stops on a break below.
Helping the downside of course is the continued global stock weakness which tends to lead to the Pavlovian reaction to buy the JPY. Also of importance is the continued plunging US yields. The 10 year is currently down -17.1 basis points at 0.741%. Although that is still below the low yield of the day at 0.6932%, the rate decline continues to prod the Fed toward another ease. With other central banks near 0% or below, they don't have the bullets the Fed still has. That should keep the dollar buyers on the defensive.
