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USD/JPY Sets a New 5-Month High on Improved Confidence and Leading Index

USD/JPY Sets a New 5-Month High on Improved Confidence and Leading Index

Benjamin Spier, Technical Strategist

Talking Points:

  • Chicago Purchasing Manager beats expectations at 63.0
  • U. of Michigan Confidence reported at 75.2 in final estimate
  • USD/JPY rises to a 5-month high

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The US Dollar rose to new 5-month high against the Yen on a combination of 3 consecutive better than expected data releases.

The Chicago Purchasing Manager barometer was reported at 63.0 for November, the second-highest reading in two-years, only second to the 65.9 Chicago Purchasing Manager result reported in October. The release also significantly beat expectations for 60.0.

The University of Michigan Confidence index was reported at 75.1 for November, higher than expectations for 73.1 and better than the previous November estimate at 72.0. Also, the US Leading Index was reported 0.2% higher in October, beating expectations for an unchanged leading economic indicator, but lower than the revised 0.9% higher index reported for September.

All three releases are medium-impact and designed to give us a reading of the current or future US economic performance. US Dollar traders remain focused on speculation of when the Fed will begin its taper of monthly asset purchases. The FOMC said in its minutes from October that the Fed is likely to taper in the coming months; therefore better than expected economic data supports arguments for a December taper.

That is why the US Dollar jumped higher on better than expected data and rose above 102.00 against the Japanese Yen. USD/JPY may next find resistance by the late-May high at 102.50.

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USD/JPY 1-Minute: November 27, 2013

USDJPY_Sets_a_New_5-Month_High_on_Improved_Confidence_and_Leading_Index_body_Picture_1.png, USD/JPY Sets a New 5-Month High on Improved Confidence and Leading Index

Chart created by Benjamin Spier using Marketscope 2.0

-- Written by Benjamin Spier, DailyFX Research. Feedback can be sent to .

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.