USD/JPY holds to weekly gains near 130.00, high volatility to persist


  • Japanese Yen among worst G10 performers after BoJ status quo.
  • US Dollar mixed between higher yields and risk sentiment.
  • USD/JPY attempts recovery, still limited below the 20-day SMA.

The USD/JPY moved off daily highs during the American session on Friday, pulling back under 130.00. The pair peaked at 130.60, the highest level in two days. The greenback weakened late on Friday amid an improvement in risk appetite.

Regarding economic data, on Friday the National Association of Realtors said US Existing Home sales fell to 4.02 million (annual rate) in December, above the market consensus of 3.95 million. Earlier, Japan reported that the Core Consumer Price Index in December rose 4.0% from a year earlier, the highest level in 41 years.

The trend in USD/JPY is still bearish, although it has been moving sideways during the last five days, in a wide range between the 127.50 area and the 20-day Simple Moving Average near 131.00. The mentioned line has become a critical dynamic resistance. If the Dollar manages to break above, a profound recovery seems likely.

A volatile week for JPY, more to come

Despite ending far from the top, the US Dollar is on its way to the biggest weekly gain in months versus the Japanese Yen. The fact that the Bank of Japan did not “pivot” from its current ultra-accommodative monetary policy weighed on the Yen. Still, market participants await a shift during the second quarter when Kuroda’s term expires in April. Japan’s latest Core CPI numbers favor that Change.

Also, sharp moves in government bond yields favored volatility in Yen’s crosses. Fears about the economic outlook boosted the demand for safety but also, central bankers continued to talk about the necessity of higher interest rates for a some time, limiting the downside in yields.

Attention will turn next week from the BoJ to the Fed. The FOMC will announce its decision on February 1. A 25 basis points rate hike is expected. However, market participants will look for clues about how far the Fed is willing to go on tightening monetary policy and how it sees the economic outlook.

Technical levels

USD/JPY

Overview
Today last price 129.86
Today Daily Change 1.42
Today Daily Change % 1.11
Today daily open 128.44
 
Trends
Daily SMA20 131.28
Daily SMA50 134.98
Daily SMA100 140.2
Daily SMA200 136.7
 
Levels
Previous Daily High 128.93
Previous Daily Low 127.76
Previous Weekly High 132.87
Previous Weekly Low 127.46
Previous Monthly High 138.18
Previous Monthly Low 130.57
Daily Fibonacci 38.2% 128.21
Daily Fibonacci 61.8% 128.49
Daily Pivot Point S1 127.82
Daily Pivot Point S2 127.2
Daily Pivot Point S3 126.65
Daily Pivot Point R1 128.99
Daily Pivot Point R2 129.55
Daily Pivot Point R3 130.16

 

 

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

EUR/USD advances toward 1.0750 on renewed US Dollar selling

EUR/USD advances toward 1.0750 on renewed US Dollar selling

EUR/USD is extending its mild recovery toward 1.0750 early Europe on Tuesday. Risk flows remain and exert additional downside pressure on the US Dollar while Euro traders reposition ahead of Sunday's French election. Mid-tier US data and Fedspeak stay in focus.

EUR/USD News

GBP/USD recovers to 1.2700 as US Dollar weakness extends

GBP/USD recovers to 1.2700 as US Dollar weakness extends

GBP/USD is recovering to test 1.2700 in the European morning on Tuesday. Extended US Dollar weakness due to improved market mood, aids the pair's latest uptick. Traders look to the US sentiment data and Fed speeches for further impetus, as the UK calendar remains data-quiet. 

GBP/USD News

Gold moves within familiar territory as traders await further cues

Gold moves within familiar territory as traders await further cues

Gold (XAU/USD) trades in familiar territory in the $2,320s on Tuesday, amid a subdued market mood after a mixed session for Asian stocks and investor loss of appetite for tech stocks on Monday. 

Gold News

Bitcoin breaks below descending wedge, finding support on key level

Bitcoin breaks below descending wedge, finding support on key level

Bitcoin spot ETFs record a $174.5 million outflow on Monday, marking seven consecutive days of continuous decline. Mt.Gox announces Bitcoin and Bitcoin Cash repayment to creditors in July.

Read more

Canada CPI Preview: Inflation expected to continue easing in May

Canada CPI Preview: Inflation expected to continue easing in May

The Canadian CPI is expected to rise at an annual rate of 2.6% in May, a tad slower than a 2.7% increase in April. On a monthly basis, the CPI inflation is seen easing to 0.3% in the same period after April’s 0.5% growth. 

Read more

Forex MAJORS

Cryptocurrencies

Signatures