USD/JPY News (US Dollar Japanese Yen)


USD/JPY tumbles to 112.00, the lowest in a month

The USD/JPY pair broke below previous lows and accelerated the decline. Recently printed a fresh 1-month low at 111.98. Price remains near the lows, facing a strong bearish pressure.


1. Technical Overview

From a technical point of view, the risk is towards the downside, as the pair develops further below its 100 and 200 SMAs in the 4 hours chart, with the shortest gaining bearish traction above the largest. Technical indicators in the mentioned chart hold below their mid-lines, with the Momentum aiming modestly higher, but the RSI consolidating around 40, rather reflecting the latest bounce than suggesting a bottom has been reached. The pair would need to recover beyond the 113.00 to shrug off the negative stance, yet only beyond 114.00 will turn actually bullish, quite unlikely for today.

Support levels: 112.20 111.90 111.60

Resistance levels: 113.10 113.50 113.85

USD/JPY PRICE SENTIMENT

USD/JPY BULLISH PERCENTAGE INDEX


USDJPY continues to show signs of topping out after stalling into familiar range resistance that has capped rallies throughout 2017. At the same time, the market needs to extend declines some more to confirm the bearish price action. Interestingly, whenever a market looks like it may be easily headed in a certain direction, it has a way of disappointing.

USD/JPY Pivot points

USD/JPY trading positions


2. Fundamental Overview

The USD/JPY pair trades near a fresh 4-week low of 112.39, weighed by US political uncertainty. The fact that the US House passed its version of the tax-reform bill was not enough to offset concerns about other issues, named Russia intervention in US election, the situation with North Korea, or the long way ahead to transfer the tax reform projects in a law. In the meantime, US Treasury yields hold around Thursday's closing levels, while equities struggle around their opening levels in Europe, as Wall Street aims to open the day modestly lower. In the macroeconomic front, the US will release some housing data and a regional manufacturing index after the opening, but as it happened this week, risk sentiment will probably lead the way.

USDJPY FUNDAMENTALS TODAY


3. Latest News & Analysis

USD/JPY News

US Key events for next week - Danske Bank

USD/JPY Analysis

USD/JPY Forecast: Trend-line rejection & yield curve flattening is bad news

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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 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.

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.


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. 

Janet Yellen

Janet L. Yellen (born August 13, 1946) took office as Chair of the Board of Governors of the Federal Reserve System (Fed) on February 3, 2014, for a four-year term ending February 3, 2018.  She had already previously served as a Vice Chair from 2010 to 2014. This American economist also serves as Chairman of the Federal Open Market Committee (FOMC), the System's principal monetary policymaking body. Her declarations are also an important source of volatility, especially for the US Dollar and the currencies traded against it.


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 carry trades. This is the reason why is one of the most trades 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 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 reffered 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 dued 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.

USDJPY 2017 YEARLY FORECAST

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', reffering 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 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 is one of the 'Majors', or most important pairs in the world. This group also includes GBP/USD, USD/JPY, AUD/USD, USD/CHF, NZD/USD and USD/CAD. The Euro Dollar 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 this 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.

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.


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