USD/JPY NEWS (US DOLLAR JAPANESE YEN)

USD/JPY rises above 110.00, potential head-and-shoulders on 1H

Risk reset in stocks is boding well for USD/JPY. The pair may be forming a head-and-shoulders pattern on the hourly chart. The bulls are not out of the woods yet and a break above 110.12 is needed to invalidate lower highs setup on the hourly chart.

Latest USDJPY News

Technical Overview

The 100-day moving average has crossed above the 200-day MA, confirming a bullish crossover, the first since August 2018.

So far, however, that has failed to inspire yen sellers. The USD/JPY pair is currently sidelined around 109.90, having faced rejection at 109.97 a few minutes ago.

The long-term bull cross is a lagging indicator and often ends up trapping the bulls on the wrong side of the market.

Fundamental Overview

Eyes broader market sentiment

The futures on the S&P 500 are currently reporting a 0.20% gain, signaling a potential risk reset in the markets.

If the equities continue to rise, the USD/JPY pair could retake the 110.00 handle.

The spot fell from 110.22 to 109.76 on Tuesday as global equity markets fell on coronavirus scare

The US stocks tracked its Asian and European equities lower on Tuesday with the S&P 500 losing 8 points or 0.27%, courtesy of coronavirus scare, sending the anti-risk yen higher.

Big Picture

THEMES AFFECTING THE USD/JPY

Japan, negative interest rates and the death of monetary policy

Joseph Trevisani FXStreet

Japan has had negative interest rates for four years. The overnight call rate set by the Bank of Japan was cut from 0.1% to -0.1% in February 2016. It has not moved since. Japan has had ultra-low rates for more than two decades. The BoJ reduced the overnight call rate to 0.5% in September 1995. It has not been above that level in the subsequent 24 years. If there were one place for 21st-century central bankers to look for the economic efficacy of very low-interest rates it should be Japan. But Japan is rarely mentioned in polite economic society.

SPECIAL USDJPY YEARLY FORECAST

USD/JPY Price Forecast 2020: A journey from trade fears to high-stakes elections

Yohay Elam FXStreet

“Bye bye bye” – N-Sync’s greatest hit from the 1990s can be used to say farewell’s the 21st century’s second decade. The global economy is in-sync once again – but political uncertainty remains elevated and will likely be enhanced in 2020. 2019 was dominated by trade talks as the primary driver for the safe-haven Japanese yen while the Federal Reserve’s shift from raising rates to cutting them weighed on the US dollar. Nevertheless, brighter prospects for the US economy – despite external headwinds – kept the currency pair in check.

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Latest USDJPY Analysis

Editors' picks

EUR/USD looks weak after rejection above 1.1100

EUR/USD is sidelined near 1.1080 ahead of the London open. Single currency failed to keep gains above 1.11 on Tuesday despite upbeat German data. The sentiment is quite bearish and a deeper drop to the 100-day average could be in the offing.

EUR/USD News

GBP/USD modestly flat around 1.3050 amid Brexit concerns, USD strength

GBP/USD holds onto the recovery despite looming Brexit uncertainty and broad-based US dollar strength. EU is likely to offer a tough Brexit deal that increases the odds of harsh departure.

GBP/USD News

Bank of Canada Rate Decision Preview: Rewards of Economic patience

Bank of Canada is forecast to leave the overnight rate at 1.75% where is has been since it was increased 25 basis points on October 24^th 2018. The bank makes rate policy decisions at eight fixed date meeting a year. The next is March 4^th.

Gold remains under pressure around $1,551 as US dollar keeps the gains

Gold bounces off the intra-day low of $1,550.40, flashed a few minutes back, to $1,551.30 by the press time of the pre-European session on Wednesday. In doing so, the safe-haven ignores the geopolitical risks emanating from China.

Gold News

USD/JPY rises above 110.00, potential head-and-shoulders on 1H

USD/JPY News

Majors

Cryptocurrencies

Signatures

Influential Institutions & People for the USD/JPY

The US Dollar Japanese Yen can be seriously affected by news or the decisions taken by two main central banks:

The Federal Reserve Bank (Fed)

On the other hand we found The Federal Reserve System (Fed) wich is the central banking system of the United States. Fed has two main targets: to keep unemployment rate to their lowest possible levels and inflation around 2%. The Federal Reserve System's structure is composed of the presidentially appointed Board of Governors, partially presidentially appointed Federal Open Market Committee (FOMC). The FOMC organizes 8 meetings in a year and reviews economic and financial conditions. Also determines the appropriate stance of monetary policy and assesses the risks to its long-run goals of price stability and sustainable economic growth.

FED Official Website, on Twitter and Facebook

The Bank of Japan (BOJ)

The Bank of Japan is the central bank of Japan and it's a juridical person established based on the Bank of Japan Act, nor being a government agency either a private corporation. The most important missions of the BOJ are the following: to issue and manage banknotes, to implement monetary policy and to ensure stability of the financial system. Almost all of the decisions are taken by the Policy Board, formed by a bunch of members working to provide currency and monetary control and setting the next moves that the central bank will take.

BOJ Official Website and on Twitter

Jerome Powell

Jerome Powell took office as chairman of the Board of Governors of the Federal Reserve System in February 2018, for a four-year term ending in February 2022. His term as a member of the Board of Governors will expire January 31, 2028. Born in Washington D.C., he received a bachelor’s degree in politics from Princeton University in 1975 and earned a law degree from Georgetown University in 1979. Powell served as an assistant secretary and as undersecretary of the Treasury under President George H.W. Bush. He also worked as a lawyer and investment banker in New York City. From 1997 through 2005, Powell was a partner at The Carlyle Group.

Jerome Powell Fed's Profile and Wikipedia

Haruhiko Kuroda

Haruhiko Kuroda was nominated, by Prime Minister Shinzo Abe, as Governor of the Bank of Japan in March 2013. He had previously worked as President of the Asian Development Bank for 8 years. As the head of the BOJ, he has a major influence over the Japanese Yen. His words are usually followed by traders in order to find any clue of next possible trend in the currency.

Draghi on BOJ'S Profile and Wikipedia

BOJ NEWS & ANALYSIS

FED NEWS & ANALYSIS

About USD/JPY

The USD/JPY (or US Dollar Japanese Yen) currency pair belongs to the group of 'Majors', a way to mention the most important pairs in the world. This group also includes the following currency pairs: EUR/USD, GBP/USD, AUD/USD, USD/CHF, NZD/USD and USD/CAD. Japanese Yen has a low-interest rate and is normally used in carrying trades. This is the reason why is one of the most traded currencies worldwide. In this pair, the US Dollar is the base currency and the Japanese Yen is the counter currency. The pair represents American (from the United States of America) and Japanese economies.

Trading this currency pair is also known as trading the "ninja" or the "gopher", although this last name is more frequently used when referred to the GBP/JPY currency pair. The US Dollar Japanese Yen usually has a positive correlation with the following two pairs: USD/CHF and USD/CAD. The nature of this correlation is due to the fact that both currency pairs also use the US Dollar as the base currency. The value of the pair tends to be affected when the two main central banks of each country, the Bank of Japan (BoJ) and the Federal Reserve Bank (Fed), face serious interest rate differential.

Related pairs

GBP/USD

The GBP/USD (or Pound Dollar) currency pair belongs to the group of 'Majors', a way to mention the most important pairs worldwide. This group also includes the following currency pairs: EUR/USD, USD/JPY, AUD/USD, USD/CHF, NZD/USD and USD/CAD. The pair is also called 'The Cable', referring to the first Transatlantic cable that was crossing the Atlantic Ocean in order to connect Great Britain with the United States of America. This term was originated in the mid-19th century and it makes GBP/USD one of the oldest currency pairs in the world.

The popularity of the Pound Dollar is due to the fact that represents two strong economies: British and American (from the United States of America). The Cable is a widely observed and traded currency pair where the Pound is the base currency and the US Dollar is the counter currency. After the result of the Brexit referendum, where the majority of the British voted to abandon the European Union, GBP/USD has been suffering some turbulence in the Forex market as a consequence of the associated risks of leaving the single market.

EUR/USD

The EUR/USD (or Euro Dollar) currency pair belongs to the group of 'Majors', a way to mention the most important pairs in the world. This group also includes the following currency pairs: GBP/USD, USD/JPY, AUD/USD, USD/CHF, NZD/USD and USD/CAD. The popularity of Euro Dollar is due to the fact that it gathers two main economies: the European and American (from United States of America) ones. This is a widely traded currency pair where the Euro is the base currency and the US Dollar is the counter currency. Since the EUR/USD pair consists of more than half of all the trading volume worldwide in the Forex Market, it is almost impossible for a gap to appear, let alone a consequent breakaway gap in the opposite direction.

Normally, the EUR/USD is very quiet during the Asian session because economic data that affects the fundamentals of those currencies is released in either the European or U.S. session. Once traders in Europe get to their desks a flurry of activity hits the tape as they start filling customer orders and jockey for positions. At noon activity slows down as traders step out for lunch and then picks back up again as the U.S. comes online.