The Non-Farm Employment Change report will be released at 8:30 am New York time this morning, Friday, February 2nd. Based on prior research, the historical average from high to low for the 8:30 am to 8:45 am price bar is 84 pips. The important question is where will the USDJPY likely go after the report?
The charts below show the USDJPY 240-minute, 60-minute, 30-minute and 15-minute charts. As indicated on the charts, the stochastics is already overbought going into the Non-Farm Employment change release. Additionally, on the 60-minute and 30-minute chart, buyers are decreasing on the highs, indicating a likely retracement to the ATR. However, the 15-minute and 30-minute also show a lack of interest by the sellers. Plus, if the current price bar on the 15-minute chart completes a reversal bar, then there is hidden divergence on the lows, indicating another upward move is likely.
Since there is another hour and thirty minute before the market release, the USDJPY could make another push upwards prior to the announcement. However, it could also spike down immediately prior to the release, only to find support at either the 30-minute ATR or the 60-minute ATR. The key areas to watch are the stochastics for potential trend divergence prior to the report and the ATRs on the 15, 30 and 60-minute timeframes. If trend divergence forms, then price will potentially retrace back to the ATR on the 60-minute chart (109.56) and, if this area holds, will likely form a new high.
However, another likely scenario could be that the reversal bar on the 60-minute holds and pushes the price lower to the ATR on the 240 minute chart (109.32).
Watching the selling volume prior to the announcement, combined with the stochastics and price bar analysis, may provide additional clues as to where the USDJPY will likely go immediately after the report.