USD/JPY Eyes 100 Ahead of US Retail Sales

Improved US jobless claims boosted sentiment on Thursday as USD/JPY flirted with 100. Commodity currencies gained as the S&P 500 hit a fresh record high. Looking ahead, comments from Kuroda and the Japanese tertiary industry index are the highlights. Earnings from Wells Fargo and JP Morgan could impact early trade.  Both of the 2 longs issued on AUDUSD before the jobs report remain in progress. We added 2 new trades in gold as well as USDCAD. For full view, please see latest Premium Insights.

Those who believe March data was skewed by seasonals got some ammunition as initial jobless claims fell to 346K compared to 360K. The Labor Department also noted that seasonal swings have affected the numbers.

The spike in claims caused some mild USD buying but positioning and market psychology are the larger driver in USD/JPY trading at the moment. The pair inched above Wednesdays high of 99.88 to reach 99.95 and could break through at any moment.There are rumors of large stops and sell orders around 100 but it's tough to get a clear picture.

It was hard not to be impressed with the resilience of AUD/USD after yesterday's weak employment report. The pair fell 50 pips and then turned around and rallied to 1.0580 which is the highest since January. Reserve managers continue to reward Aussie's high yield status and AAA rating as the RBA admits it will not intervene or jawbone in the currency.

The Asia-Pacific week winds down in typically quiet style on the data front but BOJ Governor Kuroda will be delivering a speech at 0310 GMT. The market has been sensitive to subtle hints on policy and that will continue as USD/JPY flirts with 100.

The lone indicator on the calendar is the February Japanese tertiary industry index at 2350 GMT. Expectations are for a 0.7% rise following a 1.1% decline in January.