USD/JPY tumbles to 111.00 handle after disappointing headline NFP print

The USD/JPY pair ran through some fresh offers and tumbled to fresh session lows near 111.00 handle after dismal US jobs data.

Spot accelerated its retracement move from one week highs after the headline NFP fell short of consensus and came-in to show that the economy added 138K new jobs during May. The bigger disappointment came from a sharp downward revision of previous month’s figures, now at 174K as against 211K reported earlier. 

Meanwhile, the unemployment rate unexpectedly ticked lower to 4.3%, while average hourly earnings posted a tepid m-o-m growth of 0.2% in May. 

Today’s downbeat data did little to dampen market expectations for an eventual Fed rate-hike action on June 14 but definitely seems to have receded hopes for faster rate-tightening cycle and triggered a fresh wave of US Dollar selling pressure. 

Technical levels to watch

A follow through retracement below the 111.00 handle is likely to get extended back towards 110.75 horizontal support before the pair eventually breaks below two-week lows support near mid-110.00s and head towards testing 110.24 level (May 18 lows). 

Meanwhile on the upside, 111.70-80 area remains immediate strong hurdle, which if cleared decisively is likely to trigger a short-covering rally towards 112.45 resistance with some intermediate barrier near 112.15-20 zone.