FxWirePro: USD/JPY extends Friday's NFP-led gains, 21-EMA breakout opens upside

Chart - Courtesy Trading View 

Spot Analysis:

USD/JPY was trading 0.40% higher on the day at 131.69 at around 07:45 GMT.

Previous Week's High/ Low: 131.20/ 128.08

Previous Session's High/ Low: 131.20/ 128.32

Fundamental Overview:

Reports that Bank of Japan (BoJ) Deputy Governor Masayoshi Amamiya - an advocate of ultra-loose policy - will take over as the BoJ governor keeps the yen under pressure.

Strong follow-through US Dollar buying after upbeat NFP data on Friday aids further gains in the pair.

Data released on Friday showed that the US economy added 517K jobs in January, beating consensus estimates by a big margin. 

The unemployment rate unexpectedly fell to edged down to 3.4%, or the lowest since May 1969. 

Average Hourly Earnings were up 0.3% MoM and 4.4% over the past 12 months, down from 0.4% in December and 4.9%, respectively. 

Technical Analysis:

- Price action has broken above 21-EMA which was capping upside from the past few months

- Momentum has turned bullish, RSI is now above 50 mark and biased higher

- The pair is trading above 200H MA and GMMA indicator has turned bullish on the intraday charts

- MACD and ADX support upside in the pair, Chikou span is biased higher

Major Support and Resistance Levels:

Support - 130.49 (21-EMA), Resistance - 133.25 (55-EMA)

Summary: USD/JPY shows signs of more upside potential. 21-EMA break out raises scope for gains. That said, 'Death Cross' keeps upside limited. Next major resistance lies at daily cloud. Any considerable gains only on break above.