USD/JPY slips after weak US NFP

USD/JPY is down 0.30% on Friday as the USD extends its general weakness after weak US non-farm payrolls numbers.

The US dollar’s appeal weakened following a weaker-than-expected August non-farm payrolls (NFP) report that showed 142,000 new jobs, below estimates of 160,000 but above the revised July 89,000. The unemployment rate fell as expected to 4.2% from 4.3%. Other data showed Average Hourly Earnings rose 3.8% year over year, beating expectations.

This decline in labor market conditions, along with disappointing JOLTS and ADP Employment data, fueled concerns about the economy slowing through the week, with markets growing confident of a bigger cut in September by the Federal Reserve (Fed).

USD/JPY Technical Outlook

The outlook for USD/JPY is negative as the Relative Strength Index (RSI) is nearing the oversold level of 30, signaling potential downside momentum that could eventually lead to a correction. Additionally, the Moving Average Convergence Divergence (MACD) is printing higher red bars, reinforcing bearish sentiment in the pair.

As said, the pair has seen four sessions of losses and may see an upward correction soon.