USD/JPY on its knees at key support, Japan officials on guard


  • USD/JPY is under pressure at the start of the week.
  • Uncertainty and dollar weakness are the driving forces, concerning Japanese officials. 
  • USD/JPY breaks key support structure around 104 the figure. 

USD/JPY is currently trading at 103.24, pressured in the open as US equities lead the way.

The pair has lost over 2% during the US elections as, either way, the yen was favoured whether it be a Blue wave or just a Blue ripple

A Blue wave, or a Biden White House controlling both the House and Senate, would be expected to weigh heavily on the US dollar.

In such a scenario, the greenback would give up the majority of any safe haven qualities over to the yen as the preferred choice among investors. 

A Blue ripple, or a Biden White House and a GOP Senate, would be expected to be more corporate-friendly and therefore supportive of the US stock market, thus, again, negative for the US dollar. 

Considering the complexities of the incumbent president contesting the election, the spread of the coronavirus and ongoing geopolitical matters, some of the money is likely to be on the sidelines and parked, which is again, supportive of the yen. 

Yen strength under scrutiny 

Indeed, the Japanese yen has been getting a lot of attention throughout the US elections which are potentially distressing for the Japanese officials, especially Finance Minister, Taro Aso, who has said Japan will need to respond to currency market moves if results of the US presidential election cause a sudden spike in the yen.

Aso first made the remarks when asked about market speculation that the safe-haven currency could spike if Republican nominee Donald Trump won the presidential race due on Nov. 8.

“Stability in currencies is always important,” Aso told reporters after a cabinet meeting.

More recently, the markets heard from Yoshihide Suga, who repeated this message and also gratulated Democrat Joe Biden on his election as the next US president, expressing a desire to bolster bilateral ties.

The Japanese yen has been in free fall despite the notion that Biden would win the White House. 
The problem for the yen is that the equity markets have rallied on the prospects of the GOP holding the Senate which is seen for corporations. 

More on this here:

S&P 500 Weekly Forecast: Stocks focussed on the battle for the Senate

USD/JPY levels

The yen has taken the US dollar to below the 104 level which was a critical support area.

It can be expected to test this area as resistance from where bulls may seek to load-up again at a discount towards a run to test the 2020 lows of 101.18. 

 

Overview
Today last price 103.28
Today Daily Change -0.02
Today Daily Change % -0.02
Today daily open 103.3
 
Trends
Daily SMA20 104.78
Daily SMA50 105.29
Daily SMA100 105.91
Daily SMA200 107.01
 
Levels
Previous Daily High 103.76
Previous Daily Low 103.18
Previous Weekly High 105.35
Previous Weekly Low 103.18
Previous Monthly High 106.11
Previous Monthly Low 104.03
Daily Fibonacci 38.2% 103.4
Daily Fibonacci 61.8% 103.54
Daily Pivot Point S1 103.07
Daily Pivot Point S2 102.83
Daily Pivot Point S3 102.49
Daily Pivot Point R1 103.65
Daily Pivot Point R2 103.99
Daily Pivot Point R3 104.23

 

 

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.

Feed news

Are you new to trading or have been trading for a while and you feel stuck?

Try with us!
Become Premium!
   

Latest Forex News


Latest Forex News

Editors’ Picks

EUR/USD recovers within range, lacks follow-through

Encouraging macroeconomic data from the EU and the US boosted risked sentiment, which in turn, helped EUR/USD to advance, currently nearing the weekly high at 1.2075.

EUR/USD News

GBP/USD trades around 1.39 after a choppy reaction to the BOE

GBP/USD is trading around 1.39 after an 80-pip move around the BOE's "Super Thursday." The bank announced a slowdown in buying bonds but no change to the overall scope. US jobless claims and elections in Scotland are awaited. 

GBP/USD News

Gold Price Analysis: Gold bears seeking a correction to test bullish commitments

Gold has broken above the $1,800 mark, hitting the highest levels since February. The Confluence Detector is showing that XAU/USD has very few barriers through $1,850. Bears are lurking at resistance structure, eyeing a correction ahead of NFPs.

Gold News

Dogecoin price targets $1 as the chase for high-yielding cryptos accelerates

Dogecoin price strength combined with the complementary volume highlights the continued fascination in the digital token, portending further gains in the days ahead.

More Dogecoin News

US Nonfarm Payrolls April Preview: When the economy booms, its all about rates

The US labor market’s stars appear aligned for April.The economy is expanding rapidly, employers are confident and consumers eager to throw off the restraints of the past year.

Read more

Forex MAJORS

Cryptocurrencies

Signatures