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CFD Trading Rate US Dollar vs Japanese Yen (USDJPY)

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  • 12.07.2024 08:38
    USD/JPY: The pair may come back above 160.00 – UOB Group

    The US Dollar (USD) could continue to trade in a volatile manner between 157.30 and 160.00. Scope for USD to continue to weaken; it is too early to determine if the significant support at 155.50 will come into view, UOB Group FX analysts Quek Ser Leang and Peter Chia note.

    Near-term bias is on the downside below 161.00

    24-HOUR VIEW: “The extreme volatility yesterday was surprising, as USD nosedived to 157.41 before snapping back up, closing sharply lower at 158.80 (-1.78%). The wild swings have resulted in a mixed outlook, and USD could continue to trade in a volatile manner. Expected range for today, 157.30/160.00.”

    1-3 WEEKS VIEW: “Yesterday (11 Jul, spot at 161.55), we indicated that while upward momentum is building, USD ‘has to break and close above 162.00 before a sustained advance is likely.’ We added, ‘the likelihood of USD breaking clearly above 162.00 is not high for now, but it will remain intact as long as 160.60 is not breached.’ However, USD not only broke below 160.60, but it also plunged to a low of 157.41. While the outsized decline suggests there is scope for JPY to continue to weaken, it is too early to determine if the significant support level at 155.50 will come into view. All in all, the near-term bias is on the downside, as long as USD remains below 161.00.”

  • 12.07.2024 01:07
    USD/JPY holds above 159.00, traders are on high alert for more intervention
    • USD/JPY gains ground around 159.10 in Friday’s early Asian session, up 0.19% on the day. 
    • Traders raised their bets on Fed rate cuts in September after the softer US June CPI inflation.
    • Further possible FX intervention from Japanese authorities might support the JPY and cap the pair’s upside. 

    The USD/JPY pair holds positive ground near 159.10 after bouncing off a nearly three-week low of 157.41 during the early Asian trading hours on Friday. The upside for the pair might be limited amid the fear of further foreign exchange (FX) intervention by Japanese officials. Traders will monitor the US June Producer Price Index (PPI) and the preliminary July Michigan Consumer Sentiment gauge, which are due later on Friday. 

    The lowest Consumer Price Index (CPI) reading in more than three years has triggered the possibility that the Federal Reserve (Fed) would lower rates starting in September. The US CPI inflation was softer than expected in June, with annualized headline CPI inflation easing to 3.0% YoY from the previous reading of 3.3%. Meanwhile, the monthly CPI inflation dropped 0.1% MoM in June from last month’s flat 0.0% and below the market consensus of 0.1%.

    Fed Chair Jerome Powell acknowledged the progress on price pressures, but he was not yet ready to declare inflation. However, Powell added that "more good data" would open the door for rate cuts. Financial markets saw a nearly 85% odds of a Fed rate cut in September, up from the 70% chance seen before the CPI report. Two rate cuts are anticipated this year.

    The Japanese Yen (JPY) gained traction in the previous session amid speculation that Japanese authorities might step into the FX market to support its currency. Early Friday, Japan's top currency diplomat, Masato Kanda, stated that the recent move of the JPY is somewhat rapid and he will take appropriate measures on FX if needed. The further possible intervention from officials is likely to support the JPY and act as a headwind for USD/JPY for the time being.

    Japanese Yen FAQs

    The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.

    One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation.

    The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen.

    The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.

     

  • 11.07.2024 20:58
    USD/JPY plunges on another possible ‘Yentervention’ alongside cooling US CPI inflation
    • USD/JPY plummeted 2.6% top-to-bottom after US CPI inflation eased in June.
    • Strong signs of direct market invention in Yen markets, but no confirmation.
    • Market anticipation for a September Fed rate cut is pinned to the ceiling.

    USD/JPY plummeted on Thursday, declining 2.6% in a sharp reaction to cooling US Consumer Price Index (CPI) inflation and a broadly suspected “Yentervention” by the Bank of Japan (BoJ) to prop up the floundering JPY.

    June’s US CPI inflation broadly fell below forecasts, with annualized headline CPI inflation easing to 3.0% YoY from the previous 3.3% and falling even lower than the forecast 3.1%. CPI inflation actually contracted -0.1% MoM in June, falling back from the previous month’s flat 0.0% and below the forecast 0.1%.

    US Initial Jobless Claims fell to 222K for the week ended July 5, down from the previous week’s revised 239K and improving from the forecast 236K. Thursday’s Initial Jobless Claims figure helped to push the four-week average down to 233.5K from the previous 238.75K.

    With US CPI inflation cooling at an accelerated pace, market expectations for a rate hike from the Federal Reserve (Fed) are pricing in the possibility of three quarter-point rate cuts in 2024. According to the CME’s FedWatch Tool, rate market bets of a September rate cut have soared to 95%.

    According to unconfirmed rumors citing unnamed officials within the Japanese government, a ‘Yentervention’ was timed with the release of US CPI inflation figures, sending the Yen broadly higher across the board on Thursday. In a repeat of previous Yenterventions, any official confirmation or denial is unlikely to come from BoJ or Ministry of Finance officials for several weeks.

    USD/JPY technical outlook

    USD/JPY took a steep dive on Thursday, briefly testing below the 50-day Exponential Moving Average (EMA) at 157.97 before a half-hearted recovery. The pair is still sharply down from the day’s opening bids, but a long-running bull trend that has dragged USD/JPY to multi-decade highs has left the pair buried deep in bull country.

    USD/JPY is still trading well above the 200-day EMA at 151.81, and Thursday’s bearish plunge is unlikely to cause a meaningful shift in the long-term trend.

    USD/JPY daily chart

    Japanese Yen FAQs

    The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.

    One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation.

    The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen.

    The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.

     

  • 11.07.2024 13:31
    USD/JPY falls off a cliff after US inflation miss
    • USD/JPY declines over 2.0% after US CPI data misses estimates. 
    • The data means US inflation is a step closer to the Fed’s 2.0% target. 
    • This increases the likelihood of the Fed cutting interest rates in the near term weakening the US Dollar in the process.  

    USD/JPY is in freefall, trading over 2.0% lower, in the 157.90s, after the release of US Consumer Price Index (CPI) for June showed a cooling down of inflationary pressures in the US economy. 

    The CPI data brings US inflation a step closer to the Federal Reserve’s (Fed) 2.0% target and makes it more likely the central bank will reduce interest rates in the near-term. This in turn is negative for the US Dollar (USD) (and the USD/JPY) since lower interest rates attract less foreign capital inflows. 

    The Japanese Yen (JPY) meanwhile, finds support after Japanese factory-gate inflation data showed a sharp rise in June. PPI rose 2.9% year-over-year in June, beating the previous month’s 2.6% reading and in line with consensus expectations. It was the fifth consecutive month of increasing gains for the indicator, the 41st consecutive month of PPI inflation, and the highest reading since August 2023.  

    USD/JPY Daily Chart

    USD/JPY drops like a knife after US CPI data undershoots  

    USD/JPY is sinking rapidly after the release of US CPI revealed prices rose 3.0% year-on-year in June, which was below estimates of 3.1% and the previous month's 3.3%. 

    CPI declined 0.1% on a month-over-month basis in June, when economists had expected a 0.1% rise from 0.0% in May. 

    Core CPI, which excludes volatile food and energy components, cooled to 3.3% YoY, falling below expectations of 3.4% and the previous month’s 3.4%. On a monthly basis core CPI rose 0.1%, which was below the 0.2% forecast and 0.2% of May.  

    The data makes it more likely the Fed will begin cutting interest rates in the near-term – a negative for the US Dollar. Current market-based gauges suggest a circa 70% probability of a cut in September, according to the CME FedWatch tool. 

    Downside could be limited by outlook for Yen

    Despite the decline in USD/JPY on the back of the lower US inflation reading and its contrast to higher Japanese PPI inflation data for the same period, the downside for the USD/JPY pair may be limited as the prospects of the Bank of Japan (BoJ) lifting interest rates substantially remain low. 

    Although the chances of the BoJ raising interest rates by 0.25% at its July meeting are high and this is supporting the Yen (negative for USD/JPY), the BoJ is not expected to begin an aggressive tightening cycle in which it ratchets up interest rates in meeting after meeting. Rather it is only expected to make 0.35% of interest-rate hikes in the next 12 months according to Dr. Win Thin, Global Head of Markets Strategy at Brown Brothers Harriman, so “upwards pressure” is likely to persist in Yen pairs. 


    USD/JPY faces a further risk of “stealth intervention” by the Japanese authorities, according to Sagar Dua, Editor at FXStreet. In late April and early May 2024, the Bank of Japan (BoJ) undertook direct market interventions to buttress the Yen. A too-weak Yen is seen as a financial stability risk for importers and encourages the “wrong kind” of inflation in the economy, according to Japanese policymakers, who have been warning of further interventions if the Yen continues depreciating. This continues to be a risk factor for USD/JPY.

  • 11.07.2024 11:09
    USD/JPY stays quiet near 161.50 ahead of US Inflation test
    • USD/JPY hovers below 161.50 as the US Dollar declines ahead of US Inflation data.
    • The US inflation will influence market speculation for Fed rate cuts.
    • Fears of Japan’s intervention have intensified.

    The USD/JPY pair consolidates in a tight range near 161.50 in Thursday’s European session. The asset trades back and forth as investors have shifted to sidelines ahead of the United States (US) Consumer Price Index (CPI) data for June, which will be published at 12:30 GMT.

    Economists expect that annual headline inflation decelerated to 3.1% from May’s reading of 3.3%. In the same period, the core CPI, which strips off volatile food and energy prices, is estimated to have grown steadily by 3.4%. On the month, the headline inflation grew at a meager pace of 0.1% after remaining unchanged, with core CPI rising steadily by 0.2%.

    The inflation data will significantly impact firm speculation for the Federal Reserve (Fed) to begin lowering interest rates in September. Ahead of the US Inflation data, the US Dollar (USD) faces severe selling pressure as comments from Fed Chair Jerome Powell in his testimony before Congress signaled that the US economic growth has lost momentum.

    Fed Powell said "Labor market conditions have cooled considerably compared to where they were two years ago," and added that the US “is no longer an overheated economy.”

    Market sentiment remains cautious amid uncertainty ahead of US inflation data. S&P 500 futures have posted some losses in European trading hours. The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, hovers near a four-week low around 104.85.

    Meanwhile, in Asia, the Japanese Yen remains weak despite growing speculation of Japan’s stealth intervention. The Japanese Yen is close to a multi-decade low near 162.00 against the US Dollar amid uncertainty over room for further policy tightening by the Bank of Japan (BoJ).

    Japanese Yen FAQs

    The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.

    One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation.

    The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen.

    The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.

     

  • 11.07.2024 08:59
    USD/JPY needs a break above 162.00 to grow further – UOB Group

    Instead of continuing to rise, the US Dollar (USD) is likely to trade in a sideways range of 161.25/161.80. Upward momentum is building, but USD has to break and close above 162.00 before a sustained advance is likely, UOB Group FX analysts Quek Ser Leang and Peter Chia note.

    A break above 162.00 is not ruled out

    24-HOUR VIEW: “We highlighted yesterday that USD ‘is likely to edge higher.’ However, we were of the view that ‘any advance is unlikely to break above the major resistance at 161.80.’ USD rose more than expected, reaching a high of 161.82. The advance appears to be running ahead of itself, and instead of continuing to rise, USD is likely to trade in a sideways range of 161.25/161.80.”

    1-3 WEEKS VIEW: “On Monday (08 Jul, spot at 160.65), we indicated that the USD strength from the middle of last month has come to an end. We also indicated that ‘the current price movements are likely part of a range trading phase, and USD is likely to trade between 159.40 and 161.80.’ Yesterday, USD rose a couple of pips above 161.80. Upward momentum appears to be building, but at this time, it is not sufficiently strong to suggest a resumption of USD strength. USD has to break and close above 162.00 before a sustained advance is likely. The likelihood of USD breaking clearly above 162.00 is not high for now, but it will remain intact as long as 160.60 is not breached.”

  • 10.07.2024 23:47
    USD/JPY weakens below 162.00 as traders await US CPI data
    • USD/JPY edges lower to 161.55 in Thursday’s early Asian session. 
    • Fed’s Powell gave a cautious nod to recent progress on inflation.
    • The growing speculation that BoJ will hike in the July meeting boosts the JPY. 

    The USD/JPY pair trades on a softer note around 161.55, snapping the three-day winning streak on Thursday during the early Asian session. The pair edges lower amid the decline of the US Dollar (USD) broadly. Investors will take more cues from the US Consumer Price Index (CPI) data for June, which is due on Thursday. The Federal Reserve’s (Fed) Raphael Bostic is set to speak. 

    Fed Chair Jerome Powell acknowledged the progress on inflation, yet Powell stated that it would not be appropriate to cut the policy rate until they gain greater confidence in inflation heading sustainably towards the Fed’s 2% target. 

    Traders anticipate the US Fed to maintain the benchmark interest rate in the 5.25% to 5.5% range in its next meeting on July 30-31. The US CPI inflation report on Thursday will be closely watched, and further progress on inflation could lead to key changes in their policy statement that pave the way for a September rate cut.

    On the other hand, the higher speculation that the Bank of Japan (BoJ) will be forced to raise interest rates at its July meeting provides some support to the Japanese Yen (JPY). Peter Boockvar, chief financial officer at US-based Bleakley Financial Group, said that the Yen's weakness will trigger the BoJ to "react sooner rather than later."
     

    Japanese Yen FAQs

    The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.

    One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation.

    The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen.

    The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.

     

  • 10.07.2024 19:43
    USD/JPY Price Analysis: Trends upward for third-straight day, buyers eye 162.00
    • USD/JPY gains over 0.30%, buoyed by Powell's stance against rate cuts without clear disinflation.
    • Technicals hint at resistance near the 162.00 mark; RSI approaches overbought territory.
    • Support levels to monitor: 161.10 (Tenkan-Sen), 160.73 (July 9 low), 160.26 (July 8 low) if bears take over.

    The USD/JPY stretched its advance to three consecutive days and registered gains of more than 0.30% due to Fed Chair Jerome Powell sticking to the script. He said that lowering the fed funds rate is not an option unless there is progress in the disinflation process. The pair trades at 161.77, approaching the year-to-date (YTD) high of 161.95.

    USD/JPY Price Analysis: Technical outlook

    From a technical standpoint, the USD/JPY uptrend remains intact, though sellers could emerge at around the psychological 162.00 resistance level.

    The momentum indicates a buyer-dominated market; the Relative Strength Index (RSI) hovers near overbought conditions. This could hinder the bulls' drive to lift the USD/JPY exchange rate or pave the way for consolidation.

    If USD/JPY decisively clears 162.00, the next resistance would be 163.00, and the November 1986 high of 164.87.

    Conversely, if bears stepped in and dragged prices below the Tekan-Sen at 161.10, it could exacerbate a deeper pullback. The next support would be the July 9 low of 160.73, followed by the latest cycle low of July 8 low of 160.26. If those two levels are surpassed, the USD/JPY could be set for a drop to 160.00 and below.

    USD/JPY Price Action – Daily Chart

    Japanese Yen FAQs

    The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.

    One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation.

    The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen.

    The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.

     

  • 10.07.2024 14:10
    USD/JPY: A new line in the sand for intervention at 165 – ING

    Japan’s verbal interventions are ineffective. Periods of quiet volatility may continue to push USD/JPY higher, with a new line in the sand for intervention now close to 165, ING’s FX analyst Francesco Pesole notes.

    BoJ verbal interventions bare no effect

    “Observing the Yen’s most recent demise, it is clear that Japan’s verbal interventions are ineffective. Despite some softer US data, speculative selling pressure on the Yen remains elevated.”

    “Periods of quiet volatility may continue to push USD/JPY higher, with a new line in the sand for intervention now close to 165, in our view. Crucially, large FX sales in 2Q proved to be only a temporary solution, meaning more pressure on the BoJ to hike.”

    “Markets are pricing in 6bp for the 31 July Bank of Japan meeting. We are more hawkish, narrowly favouring a 15bp July hike and another move by year-end. The BoJ can help the Yen, although our bearish USD/JPY profile primarily relies on Fed cuts.”

  • 10.07.2024 13:29
    USD/JPY Price Analysis: Short-term uptrend resumes
    • USD/JPY has resumed its short-term uptrend after a pullback. 
    • The pair could rise up to match the July 3 high at 161.95. 

    USD/JPY has continued recovering after finding support at 160.26, the July 8 low and bouncing. The pair has since established a new sequence of higher highs and higher lows on the 4-hour chart, indicative of the start of a short-term uptrend. Given “the trend is your friend” the odds now favor a continuation higher. 

    USD/JPY 4-hour Chart 

    USD/JPY is also in an uptrend on an intermediate and long-term time frame, further supporting a bullish outlook

    A break above 161.61 would signify more upside to the next target at 161.95 (the July 3 high). A break above that level would establish a higher high and provide further bullish confirmation. Such a move would probably reach the 162.70s initially, at the top of the rising channel, where it would again meet resistance. 

     

  • 10.07.2024 09:03
    USD/JPY: A break above 161.80 is in the cards – UOB Group

    The US Dollar (USD) is likely to edge higher; any advance is unlikely to break above 161.80. USD strength from the middle of last month has come to an end; for the time being, it is likely to trade in a 159.40/161.80 range, UOB Group FX strategists Quek Ser Leang and Peter Chia note.

    All eyes on 161.80

    24-HOUR VIEW: “Our view for USD to trade sideways between 160.30 and 161.30 yesterday was incorrect. USD rose to a high of 161.51, closing at 161.31 (+0.31%). There has been a slight increase in momentum. Today, USD is likely to edge higher, but any advance is unlikely to break above the major resistance at 161.80. On the downside, should USD break below 160.70 (minor support is at 161.00), it would mean that the mild upward pressure has faded.”

    1-3 WEEKS VIEW: “Our update from Monday (08 Jul, spot at 160.65) still stands. As highlighted, the USD strength from the middle of last month has come to an end. The current price movements are likely part of a range trading phase. For the time being, USD is likely to trade between 159.40 and 161.80.”

  • 09.07.2024 21:14
    USD/JPY Price Analysis: Rises past 161.00 as Powell stays cautious
    • USD/JPY edges higher eyeing YTD high of 161.95 with strong RSI support.
    • Formation of 'morning star' pattern suggests potential for further gains above 162.00.
    • Key support at July 8 low of 160.26, with significant resistance at November 1986 high of 164.87.

    The USD/JPY advanced for the second straight day and climbed above the 161.00 figure on Tuesday as Fed Chair Jerome Powell remained cautious on rate cuts despite acknowledging that the US central bank's dual mandate risks are more balanced. The pair trades at 161.29 and gains 0.28%.

    USD/JPY Price Analysis: Technical outlook

    The USD/JPY pair's uptrend is robust, with buyers poised to surpass the year-to-date (YTD) high of 161.95. The bullish Relative Strength Index (RSI) indicates the momentum is in their favor. Despite hovering around overbought conditions, the successive series of higher highs and higher lows justifies another leg up.

    The major snapped back-to-back days of losses as a doji emerged on Monday, and today’s price action completed a ‘morning star’ chart pattern, hinting that a higher price loom.

    If USD/JPY clears the psychological 161.50, the next resistance would be the YTD high ahead of 162.00. Additional gains lie overhead at the November 1986 high of 164.87.

    On the other hand, if sellers step in and drag the USD/JPY exchange rate below the July 8 cycle low of 160.26, that will clear the path to challenging the 160.00 figure.

    USD/JPY Price Action – Daily Chart

    Japanese Yen FAQs

    The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.

    One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation.

    The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen.

    The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.

     

  • 09.07.2024 08:41
    USD/JPY: A slight chance to break above 161.30 – UOB Group

    The US Dollar (USD) is likely to trade in a sideways range between 160.30 and 161.30, because USD strength from the middle of last month has come to an end, UOB Group analysts Quek Ser Leang and Lee Sue Ann note.

    USD is set to break above 161.30

    24-HOUR VIEW: “After USD fell to a low of 160.33 and rebounded last Friday, we indicated yesterday that ‘provided that USD remains below 161.15, USD could drop further to 160.20 before stabilisation can be expected.’ USD subsequently dropped to 160.25, rebounded to 161.11, and then closed largely unchanged (160.81, +0.06%). Downward pressure is easing, and instead of dropping further, USD is likely to trade in a sideways range between 160.30 and 161.30 today.”

    1-3 WEEKS VIEW: “Our update from yesterday (08 Jul, spot at 160.65) still stands. As highlighted, the USD strength from the middle of last month has come to an end. The current price movements are likely part of a range trading phase. For the time being, USD is likely to trade between 159.40 and 161.80.”

  • 08.07.2024 21:24
    USD/JPY Price Analysis: Struggles at key resistance, slumps below 161.00
    • USD/JPY consolidates with technical indicators suggesting a range-bound movement between 160.00 and 162.00.
    • Potential Japanese intervention in FX markets looms, deterring aggressive buyers.
    • A break above 161.00 could target YTD high of 161.95, while support lies at 160.22, with further downside risks to 158.25.

    The USD/JPY consolidates below the psychological 161.00 figure as US Treasury bond yields edge lower and the Greenback weakens. The traders focus on Fed Chair Jerome Powell's semi-annual testimony at the US Congress and the release of US inflation figures. The major trades at 160.79, virtually unchanged.

    USD/JPY Price Analysis: Technical outlook

    The USD/JPY daily chart is set to continue to trend higher from a price action standpoint, but fears of intervention by Japanese authorities in the FX markets might dent buyers from pushing the exchange rate higher.

    Momentum suggests the pair would consolidate within the 160.00-162.00 range, as the Relative Strength Index (RSI) remains flat in bullish territory.

    If USD/JPY buyers reclaim 161.00, that could exacerbate an upward move toward the year-to-date (YTD) high of 161.95. Further gains are seen above 162.00, at around the November 1986 high of 164.87.

    Conversely, if the major slumps below the April 29 high at 160.22, the next support would be the Senkou Span A at 159.68. A breach of the latter and the pair will test the Kijun-Sen at 158.25, ahead of the Senkou Span B at 156.91.

    USD/JPY Price Action – Daily Chart

    Japanese Yen PRICE Today

    The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the US Dollar.

      USD EUR GBP JPY CAD AUD NZD CHF
    USD   -0.00% -0.01% -0.03% -0.01% -0.04% -0.04% -0.02%
    EUR 0.00%   -0.04% -0.02% -0.02% -0.03% -0.01% -0.02%
    GBP 0.01% 0.04%   0.02% 0.02% 0.02% 0.02% 0.01%
    JPY 0.03% 0.02% -0.02%   0.02% -0.02% -0.03% 0.02%
    CAD 0.01% 0.02% -0.02% -0.02%   -0.04% -0.01% -0.02%
    AUD 0.04% 0.03% -0.02% 0.02% 0.04%   -0.02% -0.01%
    NZD 0.04% 0.01% -0.02% 0.03% 0.01% 0.02%   0.02%
    CHF 0.02% 0.02% -0.01% -0.02% 0.02% 0.00% -0.02%  

    The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).

     

  • 08.07.2024 13:18
    USD/JPY Price Analysis: Correction from top of channel finds support
    • USD/JPY has corrected back after touching the top of a rising channel. 
    • It has found support at a key support and resistance level and found its feet. 
    • The outlook remains bearish on balance in the short-term but the risk of a recovery has increased. 

    USD/JPY has corrected back after touching the top of a rising channel it has been in since the start of 2023.  

    USD/JPY Daily Chart 

    USD/JPY posted a bearish Hanging Man Japanese candlestick pattern on Wednesday July 3 (blue-shaded rectangle). The Hanging Man develops when a candle forms at a peak with a small body near its high and a long wick below. It was followed by a bearish down day, providing bearish confirmation.

    USD/JPY proceeded to sell-off down to support from the April 29 high at 160.32, forming a price gap at the end of the move down – a possible sign of exhaustion.

    USD/JPY 4-hour Chart 

    The pair has since recovered on July 8 (today) and filled the gap in the process. It is currently trading up against resistance from the 50-period Simple Moving Average (SMA). 

    Given the possible exhaustion gap that formed at the end of the sell-off, and the fact that it is in a strong medium and long-term uptrend, there is a risk the pair could continue recovering. Most corrections are composed of three waves and so far the rebound has only formed one complete wave. It is possible it could at the least recover even higher, to a target at 161.40, the July 5 high, as it completes.

    As things stand the pair technically remains in short-term downtrend which given “the trend is your friend” could also potentially extend.

    A break below 160.26, the July 8 lows, would provide confirmation of more downside to a probable target at 158.73, the June 24 low. 

    On the other hand, a break above 161.50 would be a bullish sign, and above 161.95 (July 3 high) would establish a higher high and indicate a resumption of the dominant uptrend. Such a move would probably reach the 162.70s initially, at the top of the rising channel, where it would again encounter resistance. 

     

  • 08.07.2024 11:53
    USD/JPY: To remain on the back foot in the coming weeks – Rabobank

    USD/JPY has moved from around 140 to 160 in the year to date. We see USD/JPY as holding around the 160 level on a 1 month view with USD/JPY easing back to 152 by year-end, Rabpbank FX analysts note.

    USD/JPY to hold close to 160 in the coming weeks

    “Broadly speaking USD/JPY has moved from around 140 to 160 in the year to date. Having reached a high last week close to JPY161.95, the currency pair has edged a touch lower, though this move is largely related to the weaker US Dollar (USD) than to a broad-based pick up in the value of the Japanese Yen (JPY).”

    “On balance, we see USD/JPY as holding around the 160 level on a 1 month view with USD/JPY easing back to 152 by year-end on the view that real wages will by then also be showing signs of improvement.”

    “The US Dollar (USD) could remain on the back foot in the coming weeks allowing USD/JPY to hold close to 160. Later in the year, we are looking for the JPY to win back some ground based on the assumption that a recovery in Japanese real wages will allow for a more hawkish BoJ.”

  • 08.07.2024 09:09
    USD/JPY: Is set to be rangebound between 159.40 and 161.80 – UOB Group

    The US Dollar (USD) could drop further to 160.20 before stabilisation can be expected. USD strength from the middle of last month has come to an end, and for the time being, the pair is likely to trade in a 159.40/161.80 range, UOB Group analysts note.

    USD/JPY may drop to 160.20

    24-HOUR VIEW: “Last Friday, we expected USD to trade in a 160.80/161.80 range. Our view was incorrect, as USD fell to a low of 160.33 before rebounding to close at 160.72 (-0.33%). Despite the rebound, the weakness in USD has not stabilised. Today, provided that USD remains below 161.15 (minor resistance is at 160.95), USD could drop further to 160.20 before stabilisation can be expected.”

    1-3 WEEKS VIEW: ” We noted last Thursday (04 Jul, spot at 161.45) that ‘upward momentum is beginning to slow, but only a breach of 160.45 would suggest that USD is not strengthening further.’ On Friday, USD fell to a low of 160.33. The breach of our ‘strong support’ level of 160.45 indicates that the USD strength from the middle of last month has come to an end. The current price movements are likely part of a range trading phase. For the time being, USD is likely to trade between 159.40 and 161.80.”

  • 05.07.2024 19:56
    USD/JPY Price Analysis: Tumbles below 161.00 on back-to-back bearish days
    • USD/JPY drops for the second day amid signs of a weakening US labor market.
    • For bullish momentum, USD/JPY needs to surpass 161.00, facing resistance at 161.70 (July 4 high), 161.95 (YTD high), and 162.00.
    • Key support at 160.35 (Tenkan-Sen), 159.30 (Senkou Span A), and 158.25 (Kijun-Sen), marking possible pullback points.

    The USD/JPY extended its losses to two consecutive days on Friday, as the US economy showed signs of weakness in the labor market, following a mixed US Nonfarm Payrolls report. Therefore, the pair trades at 160.72 and is down 0.34%.

    USD/JPY Price Analysis: Technical outlook

    The USD/JPY four-day rally stalled on Thursday, with sellers stepping in and driving the exchange rate below the 161.00 psychological level. This formed a doji in the weekly chart, hinting that higher prices could be difficult to achieve.

    Given the backdrop, the pair must clear 161.00 for a bullish continuation. Once cleared, the next stop would be the July 4 high of 161.70 before testing the year-to-date (YTD) high of 161.95. Overhead resistance lies ahead, with 162.00 being the next ceiling level, before the pair aims toward the November 1986 high of 164.87.

    Once the USD/JPY dropped below 161.00, the next stop would be the Tenkan-Sen at 160.35. A breach of the latter can exacerbate a pullback toward the Senkou Span A at 159.30, followed by the Kijun-Sen at 158.25.

    USD/JPY Price Action – Daily Chart

    Japanese Yen PRICE Today

    The table below shows the percentage change of Japanese Yen (JPY) against listed major currencies today. Japanese Yen was the strongest against the Canadian Dollar.

      USD EUR GBP JPY CAD AUD NZD CHF
    USD   -0.27% -0.44% -0.32% 0.15% -0.39% -0.52% -0.46%
    EUR 0.27%   -0.18% -0.03% 0.44% -0.12% -0.24% -0.21%
    GBP 0.44% 0.18%   0.14% 0.62% 0.07% -0.07% -0.05%
    JPY 0.32% 0.03% -0.14%   0.47% -0.06% -0.21% -0.17%
    CAD -0.15% -0.44% -0.62% -0.47%   -0.56% -0.68% -0.66%
    AUD 0.39% 0.12% -0.07% 0.06% 0.56%   -0.13% -0.07%
    NZD 0.52% 0.24% 0.07% 0.21% 0.68% 0.13%   0.02%
    CHF 0.46% 0.21% 0.05% 0.17% 0.66% 0.07% -0.02%  

    The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the Japanese Yen from the left column and move along the horizontal line to the US Dollar, the percentage change displayed in the box will represent JPY (base)/USD (quote).

     

  • 05.07.2024 08:58
    USD/JPY: A breach of 160.45 may signal US Dollar’s weakness – UOB Group

    The US Dollar (USD) could continue to trade in a range, probably between 160.80 and 161.80. Upward momentum is beginning to slow, but only a breach of 160.45 would suggest that USD is not strengthening further, UOB Group analysts Quek Ser Leang and Lee Sue Ann note.  

    To be sidelined in a range or to breach 160.45

    24-HOUR VIEW: “We expected USD to trade in a range between 160.80 and 161.90 yesterday. USD subsequently traded in a narrower range than expected (160.93/1611.74). The price action provides no fresh clues, and we continue to expect USD to trade in a range, probably between 160.80 and 161.80.”

    1-3 WEEKS VIEW: “We have expected a stronger USD since the middle of last month. Yesterday (04 Jul, spot at 161.45), we highlighted that ‘upward momentum is beginning to slow.’ However, we noted ‘only a breach of 160.45 would suggest that USD is not strengthening further.’ Our view remains unchanged.”

  • 05.07.2024 07:53
    USD/JPY corrects slightly below 161.00 as Japan’s intervention fears intensify, US NFP eyed
    • USD/JPY falls slightly below 161.00 as the US Dollar is under pressure due to firm Fed rate-cut prospects.
    • Fears of BoJ’s intervention to support the Japanese Yen have intensified.
    • Investors await the US NFP report for fresh guidance on interest rates

    The USD/JPY pair extends its correction to near 161.80 in Friday’s European session. The asset comes under pressure as fears of Japan’s intervention in the FX domain due to one-sided excessive moves, which have led to a sharp weakness in the Japanese Yen and a sheer sell-off in the US Dollar (USD) due to firm speculation that the Federal Reserve (Fed) to begin lowering interest rates from the September meeting.

    The Japanese Yen struggles to gain ground even though Bank of Japan (BoJ) policymakers have advocated tightening monetary policy further. The weak Japanese Yen has prompted consumer inflation expectations as Japan’s exports have become competitive globally, and import costs have increased significantly.

    However, a sharp contraction in Overall Household Spending in May has cast doubts over BoJ’s rate-hike path. The economic data unexpectedly declined by 1.8%. Economists forecasted that households’ purchasing power would have grown at a slower rate of 0.1% from the prior release of 0.5%.

    Meanwhile, the improved probability that the Fed will start reducing interest rates in September has increased investors' risk appetite. S&P 500 futures have posted nominal gains in Asian trading hours.

    The US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, has slid further and has posted a fresh three-week low to near 105.00. 10-year US Treasury yields rise to near 4.36% ahead of the United States (US) Nonfarm Payrolls (NFP) data, which will be published at 12:30 GMT.

    According to expectations, 190K workers were hired in June, significantly lower than May’s reading of 272K. The Unemployment Rate is estimated to have remained steady at 4%.

    Japanese Yen FAQs

    The Japanese Yen (JPY) is one of the world’s most traded currencies. Its value is broadly determined by the performance of the Japanese economy, but more specifically by the Bank of Japan’s policy, the differential between Japanese and US bond yields, or risk sentiment among traders, among other factors.

    One of the Bank of Japan’s mandates is currency control, so its moves are key for the Yen. The BoJ has directly intervened in currency markets sometimes, generally to lower the value of the Yen, although it refrains from doing it often due to political concerns of its main trading partners. The current BoJ ultra-loose monetary policy, based on massive stimulus to the economy, has caused the Yen to depreciate against its main currency peers. This process has exacerbated more recently due to an increasing policy divergence between the Bank of Japan and other main central banks, which have opted to increase interest rates sharply to fight decades-high levels of inflation.

    The BoJ’s stance of sticking to ultra-loose monetary policy has led to a widening policy divergence with other central banks, particularly with the US Federal Reserve. This supports a widening of the differential between the 10-year US and Japanese bonds, which favors the US Dollar against the Japanese Yen.

    The Japanese Yen is often seen as a safe-haven investment. This means that in times of market stress, investors are more likely to put their money in the Japanese currency due to its supposed reliability and stability. Turbulent times are likely to strengthen the Yen’s value against other currencies seen as more risky to invest in.

     

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