U.S. nonfarm payrolls rose 271,000 last month, far exceeding expectations at 180,000. The dollar index was up about 0.1 percent on the day at 99.256 after rising as high as 99.345 on Friday, its loftiest peak since mid-April.
Against its Japanese counterpart the dollar is trading at 123.36 its highest since late August. From a technical perspective, on the the pair has broken above the channel top, which had been capping gains since Sept month. Upward momentum is strong, however, (14) on the daily is into overbought territory and a period of consolidation is expected. Dips can offer good buying opportunities.
USD/JPY is currently at 123.37 and is on track to test 123.50 - August 21 high. Buy-dip strategies are recommended. Initial technical resistance is seen at 123.50 Aug 21 high and 123.14 retracement low post-US payrolls report would be support on the downside.
Recommendation: Buy dips around 123 levels, SL: 122.50, TP1: 123.50, TP2: 124.20
R1: 123.50 (Daily High Aug 21)
R2: 124.16 (Daily High Aug 20)
R3: 124.53 (Trend-Line off the 2015 high)
S2: 122.70 (Hourly low Nov 6)
S3: 121.87 (Hourly low Nov 6)