USD/JPY drops to 50-DMA on weak US ISM manufacturing PMI

FXStreet (Mumbai) - The USD/JPY pair extended losses to trade at its 50-DMA located at 119.63 levels after the data the ISM manufacturing PMI in the US came-in weaker-than-expected.

Weak PMI hurts USD

The US dollar failed to strengthen even though the Markit manufacturing PMI in January ticked up to 55.7 in March from the previous figure of 55.1. Moreover, the big miss on the ADP monthly employment report pushed the Treasury yields sharply lower, lending support to the Japanese Yen.

Losses were extended further to the US session low of 119.60 after the ISM manufacturing PMI for March came-in at 51.5, missing the estimate of 52.5, and down from the previous figure of 52.9. However, the pair has managed to recover slightly to 119.73 levels.

With major US data out of the way, the pair is likely to track movement in the Treasury yields and US equity markets for the rest of the day.

USD/JPY Technical Levels

The immediate support is seen at 119.63, under which losses could be extended to 119.40. On the flip side, resistance is seen at 119.97 (hourly 50-MA) and 120.25 levels.